SHREG(000803) 华创证券·2024-05-21 12:32Investment Rating - The report downgrades the company's investment rating to "Recommend" due to ongoing cost pressures and the need for time to finalize the private placement [1][15] Core Views - Despite a significant drop in industrial-grade blended oil prices, the company achieved a 17% year-on-year revenue growth in 2023 [1] - The company's revenue growth was driven by strong performance in industrial and blended oil (+29.41%), heating (+14.15%), and environmental harmless treatment (+85.74%) segments, while energy-saving equipment revenue declined by 65.59% [1] - The company's gross margin decreased by 4.56 percentage points to 14.71% in 2023, with industrial and blended oil and heating segments experiencing margin declines, while environmental harmless treatment and energy-saving equipment segments saw margin improvements [1] - The company's financial expense ratio increased from 4.26% in 2022 to 7.23% in 2023, with absolute financial expenses growing by 99.37%, putting pressure on profitability [1] - The company plans to raise up to RMB 300 million through a private placement, which is expected to help reduce the debt-to-asset ratio and alleviate financial pressure [1] - The domestic biodiesel market is expected to benefit from national and local pilot programs, potentially reversing the current weak domestic demand [1] Financial Performance - The company's revenue in 2023 was RMB 2.101 billion, a 17.34% year-on-year increase, while net profit attributable to shareholders was RMB 8.85 million, a 89.58% year-on-year decline [32] - In Q1 2024, the company's revenue was RMB 416 million, a 38.79% year-on-year decrease, and net profit attributable to shareholders was RMB 8.77 million, a 78.28% year-on-year decline [32] - The company's gross margin is expected to improve from 14.7% in 2023 to 17.0% in 2024, 17.8% in 2025, and 18.1% in 2026 [20] - The company's net profit attributable to shareholders is forecasted to be RMB 51 million in 2024, RMB 111 million in 2025, and RMB 138 million in 2026, representing significant year-on-year growth [20][31] Valuation and Forecast - The company's P/E ratio is expected to decrease from 235x in 2023 to 41x in 2024, 19x in 2025, and 15x in 2026 [20][31] - The company's P/B ratio is forecasted to decline from 1.5x in 2023 to 1.4x in 2024, 1.3x in 2025, and 1.2x in 2026 [31] - The company's EPS is projected to increase from RMB 0.02 in 2023 to RMB 0.11 in 2024, RMB 0.23 in 2025, and RMB 0.29 in 2026 [20][31]