BAOFENG ENERGY(SH:600989) Haitong Securities·2024-03-24 16:00Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [2] Core Views - The company reported a revenue of 29.136 billion yuan in 2023, a year-on-year increase of 2.48%, while the net profit attributable to the parent company was 5.651 billion yuan, a year-on-year decrease of 10.34% [5][7] - The revenue growth was primarily driven by the production of the olefins phase III project, which increased sales volume, while the decline in profit was mainly due to a significant drop in coke prices [5] - The company is actively advancing capacity construction and major projects, with several significant projects underway to enhance capacity and create new profit growth points [6] Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 29.136 billion yuan, with a year-on-year growth of 2.48% [7] - The net profit for 2023 was 5.651 billion yuan, reflecting a decline of 10.34% compared to the previous year [7] - The gross margin and net margin for 2023 were 30.40% and 19.39%, respectively, showing a decrease of 2.47 and 2.78 percentage points year-on-year [5][7] Product Performance - Revenue changes by product for 2023 included polyethylene (+12.22%), polypropylene (+4.28%), coke (-13.40%), pure benzene (-49.72%), modified asphalt (-14.08%), and MTBE (+2.21%) [5] - The average selling prices (excluding tax) for these products also saw declines, with coke prices dropping by 22.86% [5] Future Outlook - The company expects to see significant growth in EPS, forecasting 1.17 yuan for 2024, 1.46 yuan for 2025, and 1.76 yuan for 2026 [6][11] - The estimated reasonable valuation range for the company is between 18.72 and 21.06 yuan, based on a PE ratio of 16-18 times for 2024 [6] Capacity Expansion - The company has completed the olefins phase III project, adding 1.5 million tons/year of methanol capacity and 1 million tons/year of olefins capacity [6] - New projects in Inner Mongolia are expected to be completed in 2024, further enhancing production capabilities [6] Cost Management - The company has implemented 15 energy-saving projects in 2023, achieving a reduction in comprehensive energy consumption by 2.55% [6] - The comprehensive electricity price (including tax) decreased by 0.0215 yuan per kilowatt-hour compared to 2022 [6]