China XD(601179) CMS·2025-04-20 15:38Investment Rating - The report maintains a "Buy" rating for the company, estimating a net profit of 1.421 billion and 1.712 billion yuan for 2025 and 2026, respectively, corresponding to valuations of 23 and 19 times earnings [2][3]. Core Insights - The company reported significant growth in Q1 2025, with revenue, net profit, and net profit excluding non-recurring items reaching 524.5 million, 29.5 million, and 29.3 million yuan, respectively, representing year-on-year increases of 11.63%, 42.1%, and 54.14% [1][6]. - The company benefits from the high-voltage construction sector, with a notable increase in high-margin product revenue contributing to improved profit margins [6][8]. - The company has a strong order pipeline, with 6.6 billion yuan in contracts awarded in 2024 for state grid transmission and transformation equipment, marking a 17% year-on-year increase [6][8]. Financial Data and Valuation - The total revenue for 2024 is projected at 22.281 billion yuan, with a year-on-year growth of 6%. The net profit for the same year is expected to be 1.054 billion yuan, reflecting a 19% increase [2][14]. - The company’s gross margin improved to 21.02% in Q1 2025, up 3.17 percentage points year-on-year, while the net margin reached 7.04%, an increase of 1.63 percentage points [6][14]. - The company’s total assets are projected to grow from 43.779 billion yuan in 2023 to 56.708 billion yuan by 2027, indicating a robust growth trajectory [11][14]. Business Performance - The company’s transformer segment reported revenue of 9.218 billion yuan in 2024, a year-on-year increase of 17.83%, with a gross margin of 14.35% [6][8]. - The switchgear segment generated 8.504 billion yuan in revenue, up 10.97% year-on-year, with a gross margin of 26.52% [6][8]. - The company has a strong cash position with approximately 8 billion yuan in net cash and a debt ratio of 44.96% [6][8].