JXFH(300213) Southwest Securities·2024-04-26 12:00Investment Rating - The report maintains a "Buy" rating for the company with a target price of 8.40 CNY over the next six months [1]. Core Insights - The company reported a revenue of 1.12 billion CNY for 2023, a decrease of 1.9% year-on-year, while the net profit attributable to shareholders was 70 million CNY, an increase of 7.7% year-on-year. For Q1 2024, revenue was 170 million CNY, down 1.2% year-on-year, with a net loss of 6.22 million CNY, showing a reduction in losses [1]. - The company has a strong order backlog of approximately 840 million CNY, representing a year-on-year increase of 31.3%, which supports its operational goals for 2024 [1]. - The report highlights the expansion of railway investments and the potential for equipment upgrades and the implementation of 5G-R technology, which could significantly benefit the company [1]. - The company is expanding its product line in civil aviation air traffic control and has launched AI-driven platforms, indicating a focus on digital transformation across multiple sectors [1]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 1.12 billion CNY, with a net profit of 70 million CNY. Adjusted for stock option expenses, the net profit would be 90 million CNY, reflecting a growth of 29.7% [1]. - The comprehensive expense ratio for 2023 was 34%, up 3.1 percentage points year-on-year, while the gross margin remained stable at 40% [1]. Market Opportunities - The report emphasizes the growth in railway investments, with a fixed asset investment of 124.8 billion CNY in Q1 2024, a 9.9% increase year-on-year, compared to a 3.1% increase in Q1 2023 [1]. - The company has developed products based on 5G-R technology, which are expected to double its market potential once railway construction begins [1]. Strategic Developments - The establishment of a subsidiary focused on civil aviation air traffic control is expected to create a second growth curve for the company [1]. - The company has signed a comprehensive cooperation agreement with Huawei, aiming for strategic collaboration in various sectors, including railways and urban transit [1]. Earnings Forecast - The projected EPS for 2024-2026 is 0.21 CNY, 0.27 CNY, and 0.34 CNY, respectively, with corresponding dynamic PE ratios of 28, 22, and 18 [1].