STEC(600820) Changjiang Securities·2025-05-09 10:18Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - The company reported a revenue of 10.549 billion yuan for Q1 2025, a year-on-year decrease of 25.33%. The net profit attributable to shareholders was 330 million yuan, down 25.38% year-on-year, while the net profit after deducting non-recurring items was 282 million yuan, a decrease of 33.74% year-on-year [2][6]. - Despite the revenue decline, the gross profit margin improved by 2.41 percentage points to 14.95%. The expense ratio increased slightly, leading to a net profit margin of 3.13%, which is a slight decrease of 0.01 percentage points year-on-year [6]. - The company signed new contracts worth 23.084 billion yuan in Q1 2025, representing a year-on-year increase of 1.87%. The municipal and energy engineering sectors are experiencing high demand [6]. - The operating cash flow showed a net outflow of 4.884 billion yuan, an increase of 975 million yuan year-on-year, primarily due to increased payments to subcontractors and suppliers [6]. - The major shareholder has announced plans to increase their stake in the company, which is expected to enhance the company's value. The company has set a revenue growth target of 5-10% for 2025 [6]. Summary by Sections Financial Performance - Q1 2025 revenue: 10.549 billion yuan, down 25.33% year-on-year - Q1 2025 net profit: 330 million yuan, down 25.38% year-on-year - Q1 2025 net profit after non-recurring items: 282 million yuan, down 33.74% year-on-year [2][6]. Profitability Metrics - Gross profit margin: 14.95%, up 2.41 percentage points year-on-year - Net profit margin: 3.13%, down 0.01 percentage points year-on-year [6]. Order Book and Market Demand - New contracts signed in Q1 2025: 23.084 billion yuan, up 1.87% year-on-year - Strong demand in municipal and energy engineering sectors [6]. Cash Flow Analysis - Operating cash flow net outflow: 4.884 billion yuan, up 975 million yuan year-on-year - Increased payments to subcontractors and suppliers contributed to cash flow outflow [6]. Shareholder Confidence - Major shareholder plans to invest up to 500 million yuan to increase stake - 2025 revenue growth target set at 5-10% [6].