Minsheng Securities·2024-03-20 16:00Investment Rating - The report maintains a "Recommended" rating for the company, indicating a solid investment opportunity in the current market conditions [2][3]. Core Views - The company reported a revenue of 140.999 billion yuan in 2023, a year-on-year increase of 6.80%, while the net profit attributable to shareholders decreased by 33.40% to 10.430 billion yuan [2]. - The cement business faced challenges due to weak downstream demand, with a net sales volume of 293 million tons, down 5.60% year-on-year. However, the company aims to achieve a net sales volume of 299 million tons in 2024, demonstrating its commitment to maintaining market share during industry downturns [2]. - The company is actively expanding its "Cement+" business model, with significant growth in aggregate and ready-mixed concrete segments, contributing to overall revenue growth [2]. - Despite a decline in profitability, the company has maintained stable cost control, with a total expense ratio of 6.96% in 2023 [2]. - The company has slowed its capital expenditure, with plans for 2024 set at 15.2 billion yuan, a decrease of 22.09% year-on-year, while improving cash flow and maintaining a high dividend payout ratio of approximately 50% [2][3]. - The company has seen rapid growth in overseas performance, with export sales increasing by 117.83% year-on-year, benefiting from energy consumption control measures [2]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 140.999 billion yuan, with a net profit of 10.430 billion yuan, reflecting a significant decline in profitability [2][3]. - The gross margin for 2023 was 16.57%, down 4.73 percentage points year-on-year, while the net margin was 7.62%, down 4.61 percentage points [2]. Business Segments - The cement segment experienced a decline in sales volume, while the "Cement+" initiatives, including aggregate and ready-mixed concrete, showed substantial revenue growth [2]. - Aggregate business revenue increased by 73.27% year-on-year, while ready-mixed concrete revenue grew by 24.74% [2]. Capital Expenditure and Cash Flow - The company reduced its capital expenditure to 19.510 billion yuan in 2023, with a planned expenditure of 15.2 billion yuan for 2024 [2]. - Operating cash flow improved significantly, reaching 20.106 billion yuan, a year-on-year increase of 108.36% [2]. Future Outlook - The company forecasts net profits of 10.266 billion yuan, 10.868 billion yuan, and 11.742 billion yuan for 2024, 2025, and 2026, respectively, with a dynamic PE ratio of 12x, 11x, and 10x [2][3].