AVIC I.F(600705) 兴业证券·2024-05-22 03:02Investment Rating - The report maintains a "Buy" rating for the company, citing its potential for valuation recovery as it deepens its integration of industrial and financial services [1] Core Views - The company's 2023 performance was impacted by market volatility, with total revenue declining by 6.7% YoY to RMB 16.939 billion and net profit attributable to shareholders plummeting by 82.7% YoY to RMB 290 million [1] - In Q1 2024, the company reported a net loss of RMB 353 million, narrowing from the previous quarter, mainly due to the recovery of fair value changes, but investment business remains under pressure [1] - The leasing business saw a slight decline due to some market players exiting, with overseas contract proportion rising to 22.1% in 2023 [1] - Trust business is undergoing transformation, with net fee and commission income from trust and securities businesses dropping by 37.8% YoY in 2023 [1] - The company's industrial investment business achieved total income of RMB 14.552 billion in 2023, up 8.1% YoY, and is expected to benefit from technological innovation and industrial optimization in the long term [1] Financial Performance - The company's total assets stood at RMB 454.168 billion as of 2023, with net assets of RMB 64.651 billion [1] - For 2024-2026, the report forecasts net profit attributable to shareholders of RMB 1.073 billion, RMB 1.325 billion, and RMB 1.656 billion, respectively, with corresponding EPS of RMB 0.12, RMB 0.15, and RMB 0.19 [1] - The company's PB valuation is expected to be 0.70x, 0.68x, and 0.66x for 2024-2026, respectively [1] Business Segments - Leasing business revenue was RMB 10.842 billion in 2023, flat YoY, with Q1 2024 revenue declining by 9.1% YoY to RMB 2.083 billion [1] - Trust and securities businesses generated net fee and commission income of RMB 2.37 billion in 2023, down 37.8% YoY, and RMB 437 million in Q1 2024, down 23.2% YoY [1] - Industrial investment income reached RMB 4.75 billion in 2023, with total income from various entities amounting to RMB 14.552 billion, up 8.1% YoY [1] Industry Outlook - The company is positioned as a core aerospace and military industrial-financial platform, with its diversified financial services deeply connected to national emerging strategic industries [1] - The industrial investment business is expected to benefit from the comprehensive implementation of the registration system and ongoing capital market reforms, providing more diversified and flexible exit channels [1]