GREE(000651) 华创证券·2024-05-05 23:32Investment Rating - The report maintains a "Strong Buy" rating for Gree Electric Appliances, with a target price of 55 CNY, compared to the current price of 42.12 CNY [1][2]. Core Insights - Gree Electric Appliances achieved a total revenue of 205.02 billion CNY in 2023, representing a year-on-year increase of 7.8%, and a net profit attributable to shareholders of 29.02 billion CNY, up 18.4% year-on-year. In Q4 2023, the revenue reached 49.21 billion CNY, with a net profit of 8.93 billion CNY, marking increases of 17.7% and 43.9% respectively [1][2]. - The company plans to distribute a cash dividend of 23.8 CNY for every 10 shares [1]. - In Q1 2024, Gree reported a revenue of 36.6 billion CNY, a 2.5% increase year-on-year, and a net profit of 4.68 billion CNY, up 13.8% year-on-year [1][2]. Revenue Growth - The revenue growth is steady, with air conditioning products being the main revenue source, contributing 74.1% of total revenue and growing by 12.1% year-on-year. Other segments like industrial products and green energy saw significant growth rates of 31.6% and 51.2% respectively [2]. - Domestic and international sales both experienced growth, with increases of 15.2% and 7.0% year-on-year respectively [2]. Profitability Improvement - Gree's net profit reached a record high in 2023, with a gross margin of 30.6% and a net margin of 13.6%, reflecting improvements of 4.5 and 1.4 percentage points year-on-year. The company benefits from product structure upgrades and a more efficient sales model [2]. - In Q1 2024, the gross margin was 29.45%, up 2.03 percentage points year-on-year, while the expense ratio decreased by 0.5 percentage points to 13.6% [2]. Shareholder Returns - Gree has actively promoted appliance replacement policies, processing over 56.64 million units of discarded appliances by the end of 2023. The company announced a 3 billion CNY investment in 2024 to stimulate sales through these initiatives [2]. - The total cash dividends distributed since the company's listing amount to 155.298 billion CNY, with a cash dividend payout ratio of 45% in 2023, resulting in a projected dividend yield of 5.8% for 2024 [2]. Financial Projections - The report slightly adjusts the EPS forecasts for 2024 and 2025 to 5.69 CNY and 6.10 CNY respectively, with a new forecast for 2026 set at 6.51 CNY. The corresponding price-to-earnings ratios are projected at 7, 7, and 6 times [2][3].