Baosteel(600019) 国信证券·2024-08-29 04:00Investment Rating - The investment rating for Baosteel Co., Ltd. is "Outperform the Market" [1][4][8] Core Views - In H1 2024, the company's net profit attributable to shareholders decreased by 0.2% year-on-year, with revenue of 163.2 billion yuan, down 3.9% year-on-year. The non-recurring net profit attributable to shareholders increased by 14.1% to 4.24 billion yuan, while operating cash flow was 5.74 billion yuan, down 8% [1][5] - The steel industry is under pressure, but the company's operations remain relatively stable. Domestic steel demand is weak, and the overall industry is characterized by strong supply, weak demand, high costs, and low prices. The company produced 24.12 million tons of iron and 26.31 million tons of steel in H1 2024, with a record export order of 3.035 million tons [1][5] - The company has implemented cost-cutting measures, achieving a cost reduction of 4.55 billion yuan in H1 2024. It also focused on product differentiation, with sales of differentiated products increasing by 16.5% year-on-year [1][5] Financial Summary - For 2024-2026, the projected revenues are 337.2 billion yuan, 339.6 billion yuan, and 342.1 billion yuan, with year-on-year growth rates of -2.2%, 0.7%, and 0.7% respectively. The net profit attributable to shareholders is expected to be 9.36 billion yuan, 10.59 billion yuan, and 11.71 billion yuan, with growth rates of -21.7%, 13.2%, and 10.5% respectively [1][8] - The diluted EPS for the same period is projected to be 0.42 yuan, 0.48 yuan, and 0.53 yuan, with corresponding P/E ratios of 14.2x, 12.5x, and 11.3x [1][8] - The company maintains its position as an industry leader, demonstrating stable operations despite overall industry pressures [1][8]