Soochow Securities·2024-04-30 01:30Investment Rating - The report maintains an "Accumulate" rating for the company [1] Core Views - The company reported a significant decline in Q1 2024 revenue and net profit, with total revenue of 21.33 billion and net profit of 1.50 billion, representing year-on-year decreases of 32.1% and 41.1% respectively [3] - The cement industry is experiencing a downturn, with national cement production down 11.8% year-on-year in Q1, leading to intensified market competition and lower prices [3] - Despite the challenges, the company has shown effective cost control, with total expenses down 10.3% year-on-year, and a gross margin improvement to 17.7% [3] - The company is expected to maintain its competitive edge through cost leadership and expansion into new growth areas, including aggregate and concrete production [4] Financial Performance Summary - The company’s total revenue for 2022 was 132.02 billion, with projections of 150.99 billion for 2024, reflecting a year-on-year growth of 7.09% [2] - The net profit attributable to shareholders is projected to decline from 10.43 billion in 2023 to 9.02 billion in 2024, indicating a year-on-year decrease of 13.50% [2] - The latest diluted EPS is forecasted to be 1.70 yuan per share for 2024, with a P/E ratio of 13.68 based on the closing price on April 29 [2][4] Industry Outlook - The cement industry is expected to continue facing challenges in demand recovery, with inventory control relying on staggered production halts [3] - The company plans to increase its aggregate production capacity by 25.5 million tons and ready-mixed concrete capacity by 7.2 million cubic meters, indicating a steady expansion strategy [3] - The report suggests that the company’s internationalization efforts may provide new growth opportunities amid the current market conditions [4]