CMST(600787) Southwest Securities·2024-05-13 01:30Investment Rating - The report assigns a "Buy" rating to the company, with a target price of 6.55 yuan based on a 1x PB for 2024 [17][74]. Core Insights - The company is focusing on transforming into a supply chain integrated service provider, particularly in the steel, non-ferrous metals, rubber and plastics, and coal industries, aiming to enhance its supply chain capabilities through platforms like Zhongchu Steel Super and Zhongchu Easy Non-ferrous [1][16]. - Despite a 12.4% decline in revenue in 2023, the company improved its gross margin by 0.69 percentage points to 2.87% and net margin by 0.33 percentage points to 1.25% [2][39]. - The company aims to expand its Zhongchu Steel Super network to 25 outlets and establish significant industry influence in non-ferrous metals by 2025 [1][16]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 672.7 billion yuan, a decrease of 12.4% year-on-year, while net profit attributable to shareholders was 7.9 billion yuan, an increase of 22.8% [15][39]. - The first quarter of 2024 saw revenue of approximately 139.3 billion yuan, down 6.1% year-on-year, but net profit increased by 210.9% to about 2.7 billion yuan [15][39]. Business Segments - The company’s revenue from warehousing logistics, bulk commodity supply chain, and smart transportation was 23.7 billion yuan, 283.9 billion yuan, and 361.3 billion yuan respectively in 2023, with year-on-year changes of +5.3%, -31.1%, and +9.1% [40]. - The bulk commodity supply chain service revenue was 284 billion yuan in 2023, down 31%, but the gross margin increased by 0.25 percentage points [45]. Strategic Initiatives - The company is leveraging technology to enhance its supply chain services, including the development of the Zhongchu Intelligent Transportation platform, which achieved a revenue of 361.4 billion yuan in 2023, a 9.2% increase [30][66]. - The company has made significant progress in reducing financing costs, with financial expenses decreasing by 79.7% in 2023 [10]. Future Outlook - The company forecasts net profits of 9.5 billion yuan, 10.3 billion yuan, and 11.5 billion yuan for 2024, 2025, and 2026 respectively, indicating a positive growth trajectory [17][31].