XCMG(SZ:000425) Zhongyuan Securities·2024-05-16 00:30Investment Rating - The report assigns a "Buy" rating for the company, indicating an expected increase of over 15% relative to the CSI 300 index within the next six months [2][17]. Core Insights - The demand for construction machinery is recovering due to equipment upgrades and overseas expansion, with emerging industries creating new growth points [1]. - The company reported a revenue of approximately 92.85 billion yuan in 2023, a slight decrease of 1.03% year-on-year, while net profit increased by 23.51% to 5.33 billion yuan [2][6]. - The first quarter of 2024 showed a revenue of 24.17 billion yuan, a year-on-year increase of 1.18%, with net profit rising by 5.06% to 1.6 billion yuan [4]. Summary by Sections Financial Performance - In 2023, the company's gross margin was 22.38%, up by 2.17 percentage points year-on-year, and the net profit margin was 5.64%, an increase of 1.06 percentage points [3]. - The company achieved a gross margin of 22.89% in Q1 2024, reflecting continuous improvement in profitability [4]. Market Outlook - The domestic construction machinery industry is expected to recover as the demand for equipment upgrades increases, with the previous cycle peaking in early 2021 [5]. - The company is well-positioned to benefit from the recovery in the domestic market and the expansion of its international business [5][6]. Business Segmentation - Traditional construction machinery revenue faced pressure, while emerging industries and exports grew rapidly, with high-altitude work machinery revenue increasing by 35.62% year-on-year [2][3]. - The company’s international business accounted for over 40% of total revenue, with significant growth in overseas markets [2][6]. Future Projections - Revenue projections for 2024 to 2026 are 105.06 billion yuan, 118.71 billion yuan, and 133.56 billion yuan, respectively, with net profits expected to reach 6.76 billion yuan, 8.54 billion yuan, and 10.49 billion yuan [6][7]. - The company aims to enhance its gross margin further by optimizing its product mix and increasing the share of high-margin products [5][6].