Valin Steel(000932) 广发证券·2024-04-07 16:00Investment Rating - The report maintains a "Buy" rating for the company [3]. Core Views - Hualing Steel is transitioning from "premium steel" to "special steel," with a steel production capacity of 25.28 million tons in 2022. The product structure upgrade has increased the proportion of specialty steel to 63% in 2023 [1][11]. - The company is implementing three major transformations: "quality, efficiency, and dynamics," and is enhancing its integrated R&D innovation system [1][21]. - Hualing Steel's comprehensive strength is highlighted by its leading position in high-end plate and pipe products, as well as its advantageous location for long products, which enhances its competitiveness [1][25]. Summary by Sections Company Overview - Hualing Steel, with a production capacity of 25.28 million tons in 2022, is a large state-owned enterprise transitioning from "premium steel" to "special steel" [1][11]. - The company has a complete production process, covering various steel products and serving multiple downstream industries [11]. Product Structure - The product structure upgrade has led to a significant increase in specialty steel sales, which accounted for 63% of total sales in 2023 [1][13]. - The revenue and gross profit structure for 2023 shows that plates, long products, and pipes contributed 67%, 13%, and 10% to gross profit, respectively [1][17]. Strategic Development - Hualing Steel is focused on enhancing its "three strategic support systems" and aims to accelerate its transition towards high-end, intelligent, and green production [21][24]. - The company plans to increase the proportion of special steel from 10% to over 25% by the end of the "14th Five-Year Plan" [22][24]. Financial Analysis - The company forecasts EPS of 0.80, 0.81, and 0.89 CNY for 2024, 2025, and 2026, respectively, with a target PE of 10 times for 2024, leading to a reasonable value of 7.95 CNY per share [1][2][3]. - Revenue is projected to decline slightly from 164.47 billion CNY in 2023 to 159.34 billion CNY in 2024, with a net profit forecast of 5.493 billion CNY for 2024 [2].