SINOMACH-PI(002046) 中原证券·2024-05-07 06:00Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 10.80 yuan [3] Core Views - The company focuses on dual main businesses: bearings and superhard materials, continuously improving operational quality [2] - In 2023, the company achieved revenue of 2.784 billion yuan, a year-on-year decrease of 18.98%, while net profit attributable to the parent company increased by 10.96% to 259 million yuan [3] - In Q1 2024, the company's revenue was 636 million yuan, a year-on-year increase of 3.04%, and net profit attributable to the parent company was 85.52 million yuan, a year-on-year increase of 14.88% [3] - The company has optimized its business structure, reducing low-efficiency trade business and improving profitability [3][8] Business Performance Bearings Business - The bearings business achieved revenue of 1.038 billion yuan in 2023, a year-on-year increase of 5.53%, accounting for 37.28% of total revenue [3] - Special bearings, which account for over 50% of the bearings business, are expected to grow rapidly due to increased demand from the military and wind power industries [9][10] - The company's subsidiary, Luoyang Bearing Research Institute, achieved revenue of 849 million yuan in 2023, a year-on-year decrease of 17.11%, but net profit increased by 12.46% to 169 million yuan [9] Superhard Materials Business - The superhard materials business achieved revenue of 1.004 billion yuan in 2023, a year-on-year decrease of 2%, accounting for 36.07% of total revenue [3] - Superhard abrasive tools revenue grew by 23.28% to 481 million yuan, while high-end equipment revenue decreased by 27.13% to 290 million yuan [3][12] - The company has a complete industrial chain in superhard materials, from equipment to materials and tools, and is expected to benefit from the development of the industry in Henan Province [18][20] Trade and Engineering Business - The trade and engineering business revenue decreased by 49.48% to 699 million yuan in 2023, accounting for 25.11% of total revenue [3] - The company has actively reduced low-efficiency trade business, improving overall operational quality [3] Profitability and Financial Metrics - In 2023, the company's gross profit margin was 32.86%, an increase of 8.68 percentage points year-on-year, while the net profit margin was 9.71%, an increase of 2.77 percentage points [3] - In Q1 2024, the gross profit margin and net profit margin further improved to 36.26% and 13.91%, respectively, an increase of 3.4 and 4.2 percentage points compared to 2023 [8] - The company's ROE (diluted) was 2.55% in 2023, and the asset-liability ratio was 33.43% [3] Future Outlook - The company is expected to achieve revenue of 3.221 billion yuan, 3.692 billion yuan, and 4.099 billion yuan in 2024, 2025, and 2026, respectively, with net profit attributable to the parent company of 363 million yuan, 457 million yuan, and 526 million yuan [20] - The company's PE ratios for 2024-2026 are projected to be 15.77X, 12.55X, and 10.9X, respectively [20] - The company's dividend payout ratio has remained stable at around 40% in recent years [20]