SDHS(SH:600350) Xinda Securities·2024-04-19 01:00Investment Rating - The investment rating for the company is "Buy" [1]. Core Views - The company reported a net profit attributable to shareholders of 3.297 billion yuan in 2023, representing a year-on-year increase of 8.5% [1]. - The revenue for 2023 was 26.546 billion yuan, reflecting a year-on-year growth of 18.6% [1]. - The company is focusing on its core transportation business, with significant contributions from toll revenue, which amounted to 10.247 billion yuan, despite a decline in certain road segments due to expansion projects [1]. - The core road asset expansion is nearing completion, which is expected to enhance traffic volume and profitability [1][2]. - The company has a strong dividend policy, proposing a cash dividend of 20.33 million yuan, marking a historical high with a payout ratio of 61.7% [1]. Financial Summary - The projected net profits for 2024, 2025, and 2026 are 3.636 billion yuan, 4.103 billion yuan, and 4.343 billion yuan, respectively, with corresponding P/E ratios of 12, 11, and 10 [2]. - The total revenue is expected to grow from 26.546 billion yuan in 2023 to 33.611 billion yuan by 2026, with a compound annual growth rate (CAGR) of approximately 7.7% [3]. - The gross profit margin is projected to stabilize around 31.1% to 31.9% over the next few years [3]. - The return on equity (ROE) is expected to improve from 7.9% in 2023 to 9.2% by 2026 [3]. Operational Insights - The company is actively divesting from its real estate segment, with the recent disposal of 100% equity in Yantai Hosheng, generating an investment return of 538 million yuan [1]. - The completion of major road construction projects is anticipated to significantly reduce operational risks and enhance cash flow stability [1][2]. - The company has maintained a strong cash position, with cash and cash equivalents projected to increase from 4.438 billion yuan in 2023 to 18.033 billion yuan by 2026 [4].