Investment Rating - The report assigns a "Buy" rating to the company with a target price of 11.78 CNY per share based on an 8x PE for 2025 [1][5][20]. Core Insights - China Communications Construction Company (CCCC) holds a leading position in transportation infrastructure, benefiting from the domestic large-scale infrastructure projects and international expansion [1][3][20]. - The company is the largest international engineering contractor in China, with a strong historical foundation and competitive advantages in overseas markets [1][3][20]. - CCCC has announced a dividend plan, ensuring stable returns for investors [1][3][20]. Industry Overview - The overall demand in the construction industry is under pressure, but new policies and the "anti-involution" movement may improve the industry environment [2][39]. - In 2024, the total output value of China's construction industry is expected to grow by 3.9%, although the growth rate is a decline from 2023 [2][40]. - Specific sectors, such as canal engineering, show high demand with significant investment plans in place [2][47]. - The western region of China is experiencing high infrastructure demand, with major projects like the Yarlung Tsangpo River hydropower project and the New Tibet Railway expected to drive investment [2][47]. - The overseas engineering sector continues to thrive, with a 11.7% year-on-year increase in new contracts signed for foreign engineering projects [2][47]. Company Analysis - CCCC's strong position in the transportation sector allows it to fully participate in the high-demand canal construction projects [3][12]. - The company has a robust international presence, with overseas revenue growth outpacing domestic growth [3][12]. - Revenue and new contracts are showing steady growth, with improved operating cash flow and guaranteed dividends [3][12]. - The company has a diversified revenue stream, with construction being the primary source of income, accounting for 88% of total revenue in 2024 [26][32]. Financial Projections - Revenue is projected to grow from 758.68 billion CNY in 2023 to 791.82 billion CNY in 2025, with a growth rate of 5.3% in 2023 and 2.6% in 2025 [4][20]. - Net profit is expected to fluctuate, with a slight decrease in 2024 followed by a recovery in subsequent years [4][20]. - The company plans to maintain a cash dividend payout ratio of no less than 20% from 2025 to 2027, with potential increases [3][4].