行稳致远系列：战略重心重回管道主业

Investment Rating - The report assigns a "Buy" rating to the company, with a target price of 4.89 HKD per share based on a PE of 5 times for 2024 [3]. Core Insights - In 2023, the company achieved a revenue of 30.868 billion CNY, a year-on-year increase of 0.3%, while the pre-tax profit decreased by 16.49% to 2.664 billion CNY, and the net profit attributable to shareholders fell by 6.1% to 2.368 billion CNY. The decline in profit was primarily due to increased impairment provisions for receivables and rising dollar borrowing rates. Future impacts from these factors are expected to diminish, allowing net profit margins to gradually return to historical levels of 11-12%, which could lead to significant profit elasticity [1][13]. Summary by Sections 1. Revenue and Profit Trends - The company reported a stable revenue of 30.868 billion CNY in 2023, with a slight increase of 0.3% year-on-year. However, pre-tax profit decreased by 16.49% to 2.664 billion CNY, and net profit attributable to shareholders fell by 6.1% to 2.368 billion CNY, influenced by higher impairment provisions and increased dollar borrowing rates [1][13]. 2. Market Position and Growth Opportunities - The domestic plastic pipe market is stabilizing, with the company solidifying its leading position and accelerating market share growth, reaching 16.3% in 2023. The company is actively expanding into non-residential sectors and exploring overseas opportunities, particularly in Southeast Asia, the US, and Africa [1][19][22]. 3. Operational Quality and Financial Health - The company has maintained high operational quality, with a decreasing debt-to-asset ratio and ample cash reserves. The strategic shift back to core pipe business is expected to reduce capital expenditures significantly, enhancing shareholder returns after short-term operational pressures are alleviated [1][13]. 4. Profit Forecast and Investment Recommendations - The company is projected to achieve net profits of 2.8 billion CNY in 2024 and 3.3 billion CNY in 2025. The current market capitalization corresponds to a PE ratio of 3.19 and 2.71 for 2024 and 2025, respectively. The report recommends a target price of 4.89 HKD per share based on a 5x PE for 2024, supporting a "Buy" rating [1][3][22].