Guolian Securities·2024-05-11 14:30Investment Rating - The report maintains a "Buy" rating for China Communications Construction Company (CCCC) with a target price of 14.91 CNY, based on a 9x PE for 2024 [10]. Core Insights - CCCC's Q1 2024 revenue reached 176.9 billion CNY, showing a year-on-year growth of 0%. The net profit attributable to shareholders was 6.1 billion CNY, up 10% year-on-year, while the net profit excluding non-recurring items also increased by 12% to 6.1 billion CNY [3]. - The company experienced strong growth in new contracts, with a total of 507.3 billion CNY signed in Q1 2024, representing an 11% year-on-year increase. The growth was primarily driven by urban construction and overseas projects, while other sectors like municipal engineering saw declines [3][4]. - The gross profit margin for Q1 2024 was 11.9%, an increase of 0.3 percentage points year-on-year, indicating continued improvement in profitability [4]. Financial Performance Summary - As of March 2024, the company's debt-to-asset ratio was 74.2%, up 0.7 percentage points year-on-year, while the interest-bearing debt ratio decreased to 45.2%, down 0.5 percentage points year-on-year [5]. - The operating cash flow showed a net outflow of 39.6 billion CNY in Q1 2024, a significant increase in outflow compared to the previous year, attributed to mismatches in sales collections and procurement payments [5]. - The forecast for revenue from 2024 to 2026 is projected to be 830.7 billion CNY, 914.0 billion CNY, and 1,009.7 billion CNY, respectively, with year-on-year growth rates of 9%, 10%, and 10% [6][7]. Valuation Metrics - The report provides a forecast for net profit attributable to shareholders for 2024, 2025, and 2026 at 26.9 billion CNY, 31.5 billion CNY, and 36.4 billion CNY, respectively, with corresponding year-on-year growth rates of 9%, 10%, and 11% [6][7]. - The earnings per share (EPS) is expected to be 1.66 CNY, 1.93 CNY, and 2.23 CNY for the years 2024, 2025, and 2026, respectively [6][7]. - The report indicates a price-to-earnings (P/E) ratio of 5.5 for 2024, which is expected to decrease to 4.1 by 2026 [7].