AECC AP(SH:600893) AVIC Securities·2024-05-17 00:30Investment Rating - The investment rating for the company is "Buy" with a target price of 45 CNY [1]. Core Insights - The company achieved its best quarterly performance in history in Q1 2024, with a revenue of 62.72 billion CNY, representing a 1.98% year-on-year increase, and a net profit of 1.55 billion CNY, up 76.03% [1][3]. - The company reported a total revenue of 437.34 billion CNY for 2023, an increase of 17.89% year-on-year, and a net profit of 14.21 billion CNY, up 12.17% [1][4]. - The company has a strong order backlog of 340.55 billion CNY, with 269.09 billion CNY expected to be recognized as revenue in 2024 [3][4]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 437.34 billion CNY, exceeding its budget by 3.48%, and a net profit of 14.21 billion CNY, surpassing its budget by 4.64% [3][4]. - The gross margin was 11.08%, a slight increase of 0.26 percentage points, while the net margin was 3.47%, a decrease of 0.17 percentage points due to increased taxes and financial expenses [1][3]. - The company expects to achieve a revenue of 497.62 billion CNY and a net profit of 15.12 billion CNY in 2024 [3]. Business Segments - The main business segments include the manufacturing of aircraft engines and related products, foreign trade outsourcing, and non-aerospace products. The aircraft engine segment generated 408.93 billion CNY in revenue, up 18.17% year-on-year [4][5]. - The foreign trade outsourcing segment achieved a revenue of 19.48 billion CNY, an increase of 18.06%, driven by the recovery of the global aviation industry [4][5]. - The non-aerospace products segment reported a revenue of 2.62 billion CNY, a decrease of 17.09% due to reduced income from civilian products [4][5]. Operational Highlights - The company has successfully completed a capital increase for its subsidiary, which will enhance its capabilities in civil aviation engine production and repair [14][15]. - The company is positioned as a leader in the aviation engine sector, focusing on both military and civilian aviation engines, and is expected to benefit from the growing demand in these markets [17][18].