Tianfeng Securities·2024-03-19 16:00Investment Rating - The report maintains a "Buy" rating for the company with a target price of 29.2 CNY, reflecting a 0.8x PB for 2024 [4][7]. Core Views - The company's net profit for 2023 was 10.43 billion CNY, a decrease of 33.4% year-on-year, with total revenue of 140.99 billion CNY, representing a 6.8% increase [1][4]. - The cement business remains competitive, with expectations for demand stabilization and potential price elasticity, while aggregate and concrete businesses are anticipated to contribute to profit growth [4]. - The company has maintained a high dividend payout ratio, with cash dividends and share buybacks amounting to 5.405 billion CNY, which is 51.82% of net profit [4]. Financial Performance Summary - In 2023, the company achieved a gross margin of 16.57%, down 4.7 percentage points year-on-year, and a net profit margin of 7.4%, down 4.46 percentage points [3][4]. - Operating cash flow for 2023 was 20.11 billion CNY, a significant increase of 108.4% year-on-year, with year-end cash reserves of 68.36 billion CNY [3][4]. - The company’s capital expenditure for 2023 was 19.51 billion CNY, with plans to reduce it to 15.2 billion CNY in 2024, while continuing to expand production capacity [2][4]. Market Position and Outlook - The company’s self-produced cement clinker revenue was 84.05 billion CNY in 2023, a decline of 11.41% year-on-year, but the sales volume increased by 0.72% to 28.5 million tons [2]. - The average selling price per ton of cement decreased by 61.8 CNY to 273.5 CNY, while the cost per ton dropped by 34.0 CNY to 205.0 CNY, resulting in a gross profit of 68.4 CNY per ton, down 27.8 CNY year-on-year [2]. - The company plans to add significant production capacity in 2024, including 3.9 million tons of clinker and 8.4 million tons of cement, indicating ongoing growth potential [2][4].