2024-04-23 01:02Investment Rating - The report maintains an "OUTPERFORM" rating for Kunlun Energy [3][6][9] Core Views - In 2023, all business segments of Kunlun Energy achieved comprehensive profitability, with a revenue of CNY 177.35 billion, representing a year-on-year growth of 3.2%. The net profit attributable to the parent company was CNY 5.68 billion, an increase of 8.7% compared to the previous year [6][9] - The growth in revenue was primarily driven by a 9.6% increase in natural gas sales volume, reaching 49.29 billion cubic meters, particularly from industrial and commercial users [6][7] - The company expects to add 800,000 new users in 2024, with a projected 10% year-on-year increase in natural gas sales volume [7][9] Financial Summary - Revenue for 2023: CNY 177.35 billion, up 3.2% YoY [6] - Net profit for 2023: CNY 5.68 billion, up 8.7% YoY [6] - Gross profit margin: 12.0%, down 0.2 percentage points YoY [6] - Operating profit margin: 6.7%, up 0.2 percentage points YoY [6] - Net profit margin: 5.2%, up 0.5 percentage points YoY [6] - Average processing rate of LNG facilities: 90.6% [6] - Average processing rate of LNG increased by 1.1 percentage points to 45.4% [6] Dividend and Cash Flow - Operating cash flow in 2023 reached CNY 14.41 billion, with free cash flow of CNY 9.02 billion [8] - The dividend per share increased to CNY 0.28 in 2023, corresponding to a payout ratio of 40% of core profit [8] - The company expects the dividend payout ratio to increase to 45% by 2025 [8] Valuation Forecast - Revenue projections for FY24-26 are CNY 189.98 billion, CNY 202.59 billion, and CNY 215.16 billion, respectively [9] - Target price set at HKD 8.11 per share [9]