GenTech(SH:688596) SINOLINK SECURITIES·2024-05-03 04:00Investment Rating - The report maintains a "Buy" rating for the company [19][21][28]. Core Views - The company achieved a revenue of 3.835 billion RMB in 2023, representing a year-on-year growth of 41.78%, and a net profit attributable to shareholders of 401 million RMB, up 55.10% year-on-year [4]. - In Q1 2024, the company reported a revenue of 589 million RMB, a year-on-year increase of 43.31%, and a net profit of 24.9 million RMB, which is a 123.36% increase year-on-year [4]. - The company is focusing on technological innovation and has increased its R&D expenditure, with a R&D expense ratio of 9.07% in Q1 2024 [5]. - The gross margin for the company in Q1 2024 was 27.41%, an increase of 0.3 percentage points compared to the same period last year [5]. - The company is expected to see its Opex business exceed 20% of total revenue for the first time in 2024, continuing to grow in the future [5]. - The semiconductor industry expansion has led to a significant increase in new contracts, with 1Q24 new contracts amounting to 1.8 billion RMB, of which 46% came from the semiconductor sector [5]. - The company has a strong order backlog of 7.5 billion RMB as of Q1 2024, a 68% increase year-on-year, with the semiconductor sector accounting for 53% of this backlog [5]. Summary by Sections Financial Performance - In 2023, the company reported a revenue of 3.835 billion RMB and a net profit of 401 million RMB, with growth rates of 41.78% and 55.10% respectively [4]. - The projected revenues for 2024, 2025, and 2026 are 5.084 billion RMB, 6.612 billion RMB, and 7.995 billion RMB, with corresponding growth rates of 32.58%, 30.06%, and 20.92% [7]. - The net profit for the same years is projected to be 548 million RMB, 732 million RMB, and 961 million RMB, with growth rates of 36.65%, 33.53%, and 31.18% respectively [7]. Operational Strategy - The company is actively integrating industrial resources and expanding into new fields such as renewable energy and research [5]. - The gas and advanced materials business gross margin improved to 19.21% in 2023, with expectations for further enhancement as production scales up [5]. - The company is committed to a CAPEX-driven strategy to expand its OPEX business, which is anticipated to grow significantly in the coming years [5]. Market Position - The company has a robust contract liability scale of 2.537 billion RMB in Q1 2024, reflecting a year-on-year growth of 78.09% [5]. - The company’s P/E ratio is projected to decrease from 27.27 in 2023 to 20.17 in 2024, indicating a favorable valuation trend [7].