Huachuang Securities·2024-05-07 07:02Investment Rating - The report maintains a "Recommended" investment rating for the company with a target price of 34.79 CNY, compared to the current price of 26.47 CNY [2][3]. Core Insights - The company reported a Q1 2024 revenue of 5.726 billion CNY, representing a year-on-year increase of 6.73% and a quarter-on-quarter increase of 1.54%. The net profit attributable to shareholders was 760 million CNY, up 48.57% year-on-year but down 3.95% quarter-on-quarter [2][3]. - The company's gross margin for Q1 2024 was 21.47%, an increase of 3.0 percentage points year-on-year but a decrease of 2.0 percentage points quarter-on-quarter. This improvement in profitability is attributed to a reduction in raw material costs, particularly soda ash, which saw a price drop of 14% year-on-year [3]. - The company is experiencing strong demand in its photovoltaic glass business, with inventory levels decreasing and shipments increasing compared to the previous quarter. The price of photovoltaic glass is expected to rise in April due to improved supply-demand dynamics [3]. Financial Summary - The company’s total revenue is projected to grow from 21.524 billion CNY in 2023 to 37.886 billion CNY by 2026, with a compound annual growth rate (CAGR) of 22.4% [4]. - The net profit attributable to shareholders is expected to increase from 2.76 billion CNY in 2023 to 5.649 billion CNY in 2026, reflecting a CAGR of 17.5% [4]. - The earnings per share (EPS) is forecasted to rise from 1.17 CNY in 2023 to 2.40 CNY in 2026, with the price-to-earnings (P/E) ratio decreasing from 23 to 11 over the same period [4].