GLARUNTECH(SH:600562) GF SECURITIES·2024-05-03 07:32Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 17.32 CNY per share, compared to the current price of 14.30 CNY [8]. Core Insights - The company is expected to benefit from the improvement in defense information technology and military trade, with projected EPS of 0.58, 0.70, and 0.85 CNY per share for the years 2024, 2025, and 2026 respectively. A 30x PE valuation for 2024 is referenced to arrive at the target price [3][6]. Financial Performance Summary - In 2023, the company achieved a revenue of 3.282 billion CNY, a year-on-year increase of 1.77%, and a net profit of 599 million CNY, reflecting a 9.10% growth. The gross margin was 34.71%, up by 4.47 percentage points, while the net margin was 18.42%, an increase of 1.27 percentage points [24]. - For Q1 2024, the company reported a revenue of 562 million CNY, a decrease of 1.82% year-on-year, with a net profit of 116 million CNY, up by 2.70%. The gross margin for this quarter was 36.72%, an increase of 1.51 percentage points, and the net margin was 20.60%, up by 1.00 percentage point [24]. - The company's revenue is projected to grow to 3.703 billion CNY in 2024, with a growth rate of 12.8%, and further to 4.308 billion CNY in 2025, reflecting a growth rate of 16.3% [7]. Profitability and Efficiency - The report highlights a positive trend in profitability due to product structure adjustments and cost control, with the main business costs decreasing by 4.77% year-on-year. The radar equipment, industrial software, and smart rail transit segments saw revenue growth of 4.9%, a slight decline of 0.3%, and a decrease of 7.68% respectively [6][24]. - The net profit for subsidiaries in 2023 was reported as 487 million CNY for Guorui Defense, 68 million CNY for Guorui Xinyi, and 30 million CNY for Enruite, with respective year-on-year growth rates of 14.75%, a decline of 2.49%, and an increase of 6.80% [6]. Future Outlook - The company is focusing on low-altitude safety assurance and equipment manufacturing, with capabilities in providing meteorological support, low-altitude monitoring, flight applications, and intelligent manufacturing [6].