Changgao NEET(002452) 国投证券·2024-02-22 16:00Investment Rating - Buy-A rating with a 6-month target price of 7.50 RMB [4] Core Views - The company is expected to achieve revenue of 1.506 billion RMB, 1.850 billion RMB, and 2.683 billion RMB for 2023-2025, with growth rates of 23.2%, 22.8%, and 45.0% respectively [18] - Net profit is projected to be 179 million RMB, 309 million RMB, and 445 million RMB for 2023-2025, with growth rates of 206.2%, 71.9%, and 44.1% respectively [18] - The company's growth is driven by the expansion of high-voltage products and new market penetration in the power equipment sector [18] Business Overview - The company operates in two main sectors: power transmission and distribution equipment, and power engineering services [15] - Key products include high-voltage disconnectors, circuit breakers, switchgear, and power distribution automation terminals [15] - The company has a stable governance structure with high management ownership [33] Transmission Equipment - The company's high-voltage disconnector business remains stable, with a market share of 10.9% in the 2023 State Grid bidding [103] - The gas-insulated switchgear (GIS) business has seen rapid growth since 2020, with a 4.3% market share in the 2023 State Grid bidding [49] - The company has successfully developed 550kV GIS products, which have passed type tests and secured orders [105] Power Distribution Equipment - The company has expanded its product portfolio in the power distribution sector, including non-crystalline alloy transformers and environmentally friendly gas-insulated ring main units [113] - Subsidiaries Changgao Senyuan and Changgao Chengtao achieved revenues of 203 million RMB and 137 million RMB respectively in 2022 [136] Engineering Services - The company entered the power engineering sector through acquisitions, with Hubei Huawang being a key subsidiary [90] - Hubei Huawang's goodwill impairment risk has been largely mitigated, with a remaining goodwill value of 25.95 million RMB as of 2023 [137] Industry Trends - The construction of ultra-high voltage (UHV) transmission lines is expected to continue, driven by the development of large-scale renewable energy bases [67] - The power distribution network is undergoing upgrades to accommodate the increasing penetration of distributed energy resources and new energy vehicles [107] Financial Performance - The company's net profit margin is expected to improve from 11.9% in 2023 to 16.7% in 2025, driven by higher-margin high-voltage products [18] - The company's ROE is projected to increase from 8.0% in 2023 to 15.6% in 2025, reflecting improved profitability and operational efficiency [18]