Zhejiang Comm.Tech.(002061)2024-11-01 03:42Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for the stock over the next six months [4][6]. Core Views - The company reported a slight improvement in gross margin and has a sufficient backlog of orders to support upward performance [1]. - The company’s revenue for the first three quarters of 2024 reached 30.65 billion, a year-on-year increase of 3.16%, with net profit attributable to the parent company at 840 million, reflecting a growth of 10.6% [1]. - The report highlights the robust infrastructure investment in high-growth regions, particularly in Zhejiang province, which is expected to drive performance [2][4]. Financial Performance Summary - For Q3 2024, the company achieved a revenue of 12.21 billion, a year-on-year increase of 6.8%, with net profit attributable to the parent company at 327 million, up 17.66% [1]. - The comprehensive gross margin for the first three quarters of 2024 was 8.1%, an increase of 0.56 percentage points year-on-year, while the Q3 gross margin was 8.19%, up 0.72 percentage points [3]. - The company’s operating cash flow showed a net outflow of 3.088 billion for the first three quarters, which is an increase in outflow compared to the previous year [3]. Order Backlog and Market Conditions - The new contract amount signed in the first three quarters of 2024 was 46.4 billion, a decrease of 4.9% year-on-year, but the total amount of unfinished projects reached 1430.59 billion, an increase of 32.5% year-on-year, indicating a strong order backlog [2]. - Infrastructure investment in Zhejiang province is projected to grow by 15.8% year-on-year, with significant increases in power, heat, gas, and water supply investments [2]. Earnings Forecast - The company is expected to achieve net profit attributable to the parent company of 1.56 billion, 1.81 billion, and 2.10 billion for the years 2024, 2025, and 2026, respectively, with corresponding P/E ratios of 7, 6, and 5 [4][5].