Huachuang Securities·2024-03-29 16:00Investment Rating - The report maintains a "Strong Buy" rating for China Railway Group (601390) with a target price of 8.7 CNY per share [2]. Core Views - The company's performance in 2023 met expectations, with revenue reaching 1.26 trillion CNY, a year-on-year increase of 9.45%, and net profit attributable to shareholders of 33.48 billion CNY, up 7.07% year-on-year [2]. - The company has a rich resource base, particularly in mineral resources, which contributed 14% to its performance [2]. - The new contracts signed in 2023 totaled 3.10 trillion CNY, reflecting a year-on-year increase of 2.20%, with significant growth in orders for highways, urban rail, and housing construction [2]. Financial Summary - Revenue and Profit: In 2023, the company achieved a revenue of 1,263.48 billion CNY, with a net profit of 334.83 billion CNY. The quarterly revenue growth rates were +2.1%, +8.4%, +1.5%, and +24.5% respectively [2]. - Segment Performance: Revenue from infrastructure construction increased by 10.58% to 1.09 trillion CNY, while real estate development saw a decline of 4.76% to 509 billion CNY [2]. - Profitability Metrics: The gross margin improved slightly to 10.15%, with a notable increase in the gross margin for resource utilization to 59.70% [2]. - Earnings Forecast: The expected EPS for 2024-2026 is projected to be 1.45 CNY, 1.57 CNY, and 1.72 CNY per share respectively [2]. Key Financial Indicators - Main Revenue (Million CNY): 2023A: 1,263,475; 2024E: 1,369,608; 2025E: 1,482,242; 2026E: 1,601,481 [8]. - Net Profit (Million CNY): 2023A: 33,483; 2024E: 35,957; 2025E: 38,902; 2026E: 42,504 [8]. - Debt Ratio: The asset-liability ratio stands at 74.86% [5].