HONGLU(SZ:002541) Hua Yuan Zheng Quan·2026-01-20 11:38Investment Rating - The report assigns a "Buy" rating for the company, indicating a strong potential for growth and investment opportunity [6]. Core Insights - The company, Honglu Steel Structure, is a leading player in the domestic steel structure manufacturing sector, established in 2002, with a focus on steel structure and supporting product manufacturing [7]. - The company is expected to achieve significant revenue growth driven by its scale advantages and ongoing smart transformation initiatives, with projected revenues of RMB 27.27 billion in 2026, reflecting a 20.15% year-on-year growth [6][8]. - Despite short-term profit pressures, the core business remains resilient, with revenue from steel structure operations consistently accounting for over 90% since 2018 [7]. - The company has increased its cash dividend payout ratio from 15% to 30%, demonstrating a commitment to shareholder returns and a solid financial position [7]. Financial Performance Summary - Revenue projections for the company are as follows: RMB 23.54 billion in 2023, RMB 21.51 billion in 2024, RMB 22.69 billion in 2025, RMB 27.27 billion in 2026, and RMB 29.45 billion in 2027, with corresponding growth rates of 18.60%, -8.60%, 5.48%, 20.15%, and 8.01% respectively [6]. - The net profit attributable to the parent company is forecasted to be RMB 1.18 billion in 2023, RMB 772 million in 2024, RMB 684 million in 2025, RMB 829 million in 2026, and RMB 988 million in 2027, with growth rates of 1.43%, -34.51%, -11.39%, 21.13%, and 19.24% respectively [6]. - The company’s return on equity (ROE) is projected to be 12.83% in 2023, declining to 8.03% in 2024, and then gradually improving to 8.74% by 2027 [6]. Market Position and Strategy - Honglu Steel Structure has a clear growth path, with a production capacity of 5.2 million tons by the end of 2024 and a capacity utilization rate of 86.75% [7]. - The company is actively expanding its overseas market presence, leveraging strong relationships with core clients, which account for 30.61% of revenue from the top five clients in 2024 [7]. - The report highlights the increasing penetration of steel structures in various construction sectors, with a projected growth in processing volume from 89 million tons in 2020 to 109 million tons in 2024, reflecting a compound annual growth rate (CAGR) of 5.20% [7].