Riyue HI(SH:603218) Soochow Securities·2024-04-26 11:02Investment Rating - The investment rating for the company is "Buy" [14][18][21]. Core Insights - The company has developed new products in its alloy business, including low-alloy steel and chromium-molybdenum steel, achieving revenue of 0.52 billion yuan in 2023, a 77% year-on-year increase. The company is expected to double its shipments in 2024 [2][10]. - The company announced the transfer of 80% equity in the 300MW wind farm in Jiuquan for 380 million yuan, which is expected to contribute 240 million yuan in investment income in 2024 [2][10]. - The company reported a revenue of 4.656 billion yuan in 2023, a decrease of 4.30% year-on-year, while the net profit attributable to shareholders was 482 million yuan, an increase of 39.84% [31][44]. Financial Performance - In 2023, the company's gross profit margin was 18.66%, an increase of 5.82 percentage points year-on-year, and the net profit margin was 10.34%, an increase of 3.26 percentage points [37][44]. - The company expects to achieve net profits of 640 million yuan, 770 million yuan, and 890 million yuan for 2024, 2025, and 2026, respectively, with growth rates of 32%, 21%, and 15% [14][18]. - The company’s total assets are projected to grow from 13.813 billion yuan in 2023 to 17.290 billion yuan by 2026 [15]. Market Outlook - The company anticipates a shipment of 550,000 tons in 2024, representing a year-on-year increase of over 20%, with a focus on high-margin exports and offshore products [22][26]. - The company is expected to maintain a leading gross margin in the casting industry, outperforming competitors by over 10 percentage points [22][26].