POWERCHINA Ltd(601669) GOLDEN SUN SECURITIES·2024-10-31 01:15Investment Rating - The report maintains a "Buy" rating for the company [1][3]. Core Views - The company's Q3 performance met expectations, with a slight narrowing of revenue decline. For the first three quarters of 2024, the company achieved a revenue of 425.7 billion, a year-on-year increase of 1.2%, and a net profit attributable to shareholders of 8.8 billion, a year-on-year decrease of 7.2% [1]. - The energy and power sector continues to show high demand, while overseas business performance is strong. New contracts signed in the first three quarters reached 861.1 billion, a year-on-year increase of 5.4% [1][2]. Financial Performance Summary - For Q1-Q3 2024, the company reported a gross margin of 12.4%, a slight increase of 0.1 percentage points year-on-year. The net profit margin for the same period was 2.07%, down 0.19 percentage points year-on-year [1]. - The company’s operating cash flow showed a net outflow of 46.9 billion, an increase in outflow of 11 billion compared to the same period last year, indicating ongoing pressure on cash collection [1][8]. - The company expects net profits for 2024-2026 to be 12.6 billion, 13.3 billion, and 14.2 billion respectively, with corresponding EPS of 0.73, 0.77, and 0.83 [1][2]. Business Segment Performance - In terms of new contracts, the energy and power sector signed 518.4 billion, a year-on-year increase of 20%, while municipal infrastructure and other sectors saw declines [1]. - The company’s overseas contracts reached 176 billion, reflecting a year-on-year growth of 15% [1]. Market Valuation - The current stock price corresponds to a P/E ratio of 7.5 for 2024, 7.0 for 2025, and 6.6 for 2026, indicating a potentially attractive valuation [2][3].