HUAXIN CEMENT(600801) 天风证券·2025-01-25 23:31Investment Rating - The report maintains a "Buy" rating for Huaxin Cement, with a target price not specified [7]. Core Views - Huaxin Cement has expanded its overseas production capacity significantly, with a total overseas clinker capacity of 15.44 million tons per year and cement grinding capacity of 22.54 million tons per year as of Q3 2024. The overseas clinker sales volume increased by 41% year-on-year to 12.05 million tons, contributing to a net profit of 8.47 billion yuan, which is a 32% increase year-on-year [1][2][38]. - The company is expected to achieve a total net profit of 1.8 billion yuan for the year, with projections for net profits of 1.83 billion, 2.88 billion, and 3.15 billion yuan for 2024-2026, respectively [1][38]. Summary by Sections Overseas Business Expansion - Huaxin Cement has established a presence in 16 countries, with a focus on regions such as Central Asia, Southeast Asia, the Middle East, and Africa. The company ranks third in overseas production capacity among Chinese cement companies, with an annual capacity of 14.86 million tons [2][12]. - The share of overseas revenue has increased from 14% in 2022 to 22% in the first half of 2024, with overseas revenue reaching 3.7 billion yuan, a year-on-year increase of 55.5% [2][15]. Profitability and Financial Performance - The overseas EBITDA for 2023 was approximately 1.934 billion yuan, a 38% increase year-on-year, accounting for 24% of total EBITDA. By the first half of 2024, the overseas EBITDA rose to approximately 912 million yuan, representing 28% of total EBITDA [2][15]. - The report indicates that the overseas EBITDA margin is consistently higher than the domestic margin by about 10 percentage points, with margins of 24.7% for overseas and 18.5% for domestic operations as of the first half of 2024 [2][15]. Future Growth Potential - The company has plans for further expansion in Africa, where urbanization rates and per capita cement consumption are still low compared to historical levels in China. This indicates significant growth potential for cement demand in the region [4][30]. - Recent acquisitions, including a 3000T/D clinker production line in Mozambique and a significant investment in Nigeria, are expected to contribute additional profits, estimated between 700 million to 1 billion yuan from new assets [3][25][30]. Financial Projections - The report forecasts a net profit of 1.83 billion yuan for 2024, with expectations of continued growth in subsequent years. The current valuation stands at 12x PE, with a dividend yield of approximately 4.4% [1][38]. - The projected revenues for 2024-2026 are 34.78 billion, 40.24 billion, and 42.42 billion yuan, respectively, with corresponding growth rates of 3.03%, 15.69%, and 5.42% [5][38].