Dongfang Electronics(SZ:000682) EBSCN·2024-04-19 10:01Investment Rating - Maintain "Buy" rating [1] Core Views - The company achieved revenue of 6.478 billion yuan in 2023, a year-on-year increase of 18.64%, and net profit attributable to the parent company of 541 million yuan, a year-on-year increase of 23.46% [1] - In Q4 2023, the company achieved revenue of 2.378 billion yuan, a year-on-year increase of 21.47%, and net profit attributable to the parent company of 197 million yuan, a year-on-year increase of 24.85% and a quarter-on-quarter increase of 38.73% [1] - The company plans to distribute a cash dividend of 0.8 yuan per 10 shares (tax included) [1] - The transmission and distribution automation and smart power distribution business maintained rapid growth, with revenues of 623 million yuan and 3.694 billion yuan respectively, up 45.28% and 20.99% year-on-year, and gross margins increased by 5.06 and 1.46 percentage points respectively [1] - The new energy and energy storage business achieved a breakthrough, with revenue increasing by 162.36% year-on-year to 344 million yuan [1] - R&D expenditure reached a new high of 558 million yuan, accounting for 8.62% of revenue, an increase of 0.31 percentage points year-on-year [1] - The company's overseas business achieved new breakthroughs, focusing on markets in Southeast Asia, the Middle East, Central Asia, and Africa [1] Business Performance - Transmission and distribution automation and smart power distribution business are expected to maintain rapid growth under the acceleration of grid digitalization [1] - The virtual power plant business is expected to see new development opportunities as the proportion of new energy installed capacity in China rapidly increases [1] - Weidun's bidding scale steadily increased, with 743 million yuan won in State Grid centralized bidding and 142 million yuan won in Southern Grid unified bidding [1] - Overseas business achieved breakthroughs in the Middle East, Central Asia, Africa, and Southeast Asia, including projects in Saudi Arabia, Uzbekistan, Zambia, Malaysia, Sri Lanka, and Thailand [1] Financial Projections - Adjusted profit forecast: expected net profit attributable to the parent company of 705 million yuan, 887 million yuan, and 1.034 billion yuan for 2024-2026 (down 11%, down 12%, and newly added respectively) [1] - Current stock price corresponds to a PE of 19 times for 2024 [1] Market Data - Total share capital: 1.341 billion shares [5] - Total market value: 13.059 billion yuan [5] - 1-year low/high: 6.20/10.13 yuan [5] - 3-month turnover rate: 59.75% [5] Historical Performance - Revenue growth rates for 2022-2026E: 21.73%, 18.64%, 23.54%, 20.69%, 21.55% [12] - Net profit growth rates for 2022-2026E: 26.06%, 23.46%, 30.30%, 25.81%, 16.49% [12] - EPS for 2022-2026E: 0.33, 0.40, 0.53, 0.66, 0.77 yuan [12] - ROE (attributable to parent company) for 2022-2026E: 10.57%, 11.81%, 13.61%, 15.00%, 15.31% [12] - PE for 2022-2026E: 30, 24, 19, 15, 13 [12] - PB for 2022-2026E: 3.1, 2.8, 2.5, 2.2, 1.9 [12]