Guotou Securities·2025-09-01 07:37Investment Rating - The investment rating for the company is "Buy-A" with a 6-month target price of 11.2 CNY, compared to the current stock price of 9.16 CNY [4]. Core Views - The company's revenue for the first half of 2025 was 337.06 billion CNY, a year-on-year decrease of 5.71%, with a net profit attributable to shareholders of 9.57 billion CNY, down 16.06% year-on-year [2][3]. - The decline in revenue is primarily attributed to a significant drop in new construction and construction data in the real estate sector, alongside weakening infrastructure investment growth [2]. - Despite the overall revenue decline, the company saw a substantial narrowing of revenue decline in Q2 2025, with a year-on-year increase of 1.03% [2]. - The company’s new contract signing amount reached 991.05 billion CNY in H1 2025, reflecting a year-on-year growth of 3.14%, with notable growth in infrastructure construction and dredging business contracts [4][8]. Summary by Sections Revenue and Profitability - In H1 2025, the company reported a revenue of 3370.55 billion CNY, down 5.71% year-on-year, with a net profit of 95.68 billion CNY, down 16.06% year-on-year [2][3]. - The gross profit margin decreased to 10.64%, a decline of 1.01 percentage points year-on-year, with specific margins for construction, design, and dredging at 9.74%, 17.03%, and 11.00% respectively [3]. Cash Flow and Expenses - The company experienced a significant improvement in operating cash flow, with a net outflow of 773.01 billion CNY in H1 2025, which was an increase in outflow of 31.4 billion CNY year-on-year [3]. - The total expense ratio decreased to 4.94%, down 0.75 percentage points year-on-year, indicating effective cost control [3]. Business Segments and Contracts - The new contracts signed in H1 2025 amounted to 9910.54 billion CNY, with growth in infrastructure construction and dredging contracts, while the design segment saw a decline of 25.39% [4][8]. - Emerging business areas, including energy and new materials, contributed significantly, with new contracts in these sectors totaling 3202.55 billion CNY, accounting for 32% of total new contracts [8]. Future Outlook - The revenue forecasts for 2025-2027 are adjusted to 7846.8 billion CNY, 8160.7 billion CNY, and 8487.1 billion CNY, with expected net profits of 227.9 billion CNY, 246.0 billion CNY, and 258.6 billion CNY respectively [9]. - The company aims to maintain a dividend policy with a minimum payout ratio of 20%, with potential adjustments based on cash flow and industry conditions [9].