ShaanGu(SH:601369) Guotai Junan Securities·2024-04-21 05:32Investment Rating - The report maintains a "Buy" rating for Shaangu Power (601369) with a target price of 12.16 CNY, up from the previous target of 11.16 CNY [1][8]. Core Views - The company is experiencing steady growth in industrial gases, while compressed air energy storage is expected to open new growth opportunities. However, short-term pressure is noted in equipment and industrial services due to a decline in downstream demand [1][8]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 10.14 billion CNY, a decrease of 5.79% year-on-year, with a net profit attributable to shareholders of 1.02 billion CNY, reflecting a growth of 5.36% [1][8]. - The company’s energy conversion equipment generated revenue of 4.33 billion CNY, down 1.63% year-on-year, while industrial services revenue was 2.32 billion CNY, down 30.01% due to short-term demand decline [1][8]. Earnings Forecast - The report projects the EPS for 2024 to be 0.64 CNY, down from the previous estimate of 0.72 CNY, with a new estimate for 2026 at 0.83 CNY [1][8]. - The expected revenue for 2024 is 11.44 billion CNY, with a projected growth rate of 12% [1][8]. Market Position - The company is positioned in the industrial sector, focusing on energy conversion equipment, industrial services, and energy infrastructure operations, which are critical for national economic pillars [1][8]. - The report highlights the company's leading position in compressed air energy storage technology, which is anticipated to drive new growth [1][8]. Valuation Metrics - The report indicates a PE ratio of 16.41 for 2023, projected to decrease to 15.20 in 2024, reflecting a favorable valuation compared to industry peers [1][8]. - The net profit margin is expected to stabilize around 10.1% in 2023, with a slight increase projected for 2024 [1][8]. Industry Outlook - The industrial gas market is noted to have significant growth potential, particularly with the domestic substitution of electronic specialty gases [1][8]. - The report emphasizes the importance of the compressed air energy storage market, which is expected to expand significantly, contributing to the company's future growth [1][8].