CMES(SH:601872) Huachuang Securities·2024-04-30 18:31Investment Rating - The report maintains a "Recommend" rating for the company, indicating an expected outperformance of the benchmark index by 10%-20% over the next six months [2][24]. Core Views - The company achieved a net profit attributable to shareholders of 1.38 billion yuan in Q1 2024, representing a year-on-year increase of 22.6% [2]. - The revenue for Q1 2024 was 6.25 billion yuan, up 6.3% year-on-year, with a focus on shareholder returns highlighted by a mid-term dividend plan [2]. - The report emphasizes the company's strong performance in oil and bulk shipping segments, with significant growth in net profit for the bulk shipping sector [2]. Financial Summary - Revenue and Profitability: - Q1 2024 revenue was 6.25 billion yuan, with a net profit of 1.38 billion yuan, reflecting a 22.6% increase year-on-year [2]. - The gross margin for Q1 2024 was approximately 28.6%, up 2.1 percentage points year-on-year, while the net profit margin was 22.0%, an increase of 3.9 percentage points [2]. - Cost and Expenses: - Operating costs for Q1 2024 were 4.46 billion yuan, a 3.2% increase year-on-year, with the expense ratio at approximately 8.3%, down 0.9 percentage points [2]. - Segment Performance: - Revenue from oil transportation, bulk shipping, container shipping, and roll-on/roll-off shipping was 2.55 billion, 1.90 billion, 1.04 billion, and 0.40 billion yuan respectively, with year-on-year growth rates of 5.4%, 17.3%, -10.0%, and 9.5% [2]. - The net profit contributions from these segments were 0.87 billion, 0.36 billion, 0.10 billion, and 0.08 billion yuan, with significant growth in the bulk shipping segment [2]. - Future Earnings Forecast: - The report maintains profit forecasts for 2024-2026, estimating net profits of 7.77 billion, 9.21 billion, and 10.46 billion yuan, with corresponding EPS of 0.95, 1.13, and 1.28 yuan [2][17]. - Valuation: - The target price is set at 11.3 yuan, representing a 33% upside from the current price of 8.53 yuan, based on a 10x PE for the 2025 earnings cycle [2][4]. Dividend Plan - The company has proposed a mid-term dividend plan, allowing for cash dividends not exceeding 50% of the net profit attributable to shareholders for the period ending June 30, 2024 [2]. Market Position - The company is positioned as a comprehensive foreign trade shipping platform under the China Merchants Group, with a focus on enhancing shareholder returns and capitalizing on cyclical value growth [2].