Excluding the impact of non-economic and R & D expenses, the net profit of Q1 operating tons rebounded compared with the same period last year. The company achieved revenue from 2024Q1 44Bruceleecrouchingtigerhiddendragon.300 million yuan, down 12%, which is expected to be mainly due toBruceleecrouchingtigerhiddendragon: 1) the decline in steel prices led to a decline in the price of steel structure products (the daily average price of 2024Q1 hot-rolled coil was 4073 yuan / ton, down 6%); 2) the base was relatively high in the same period last year (after the impact of specific macro events, the 2023Q1 industry entered a rush period, owners accelerated delivery, and revenue increased by 43%). 2024Q1 realizes homing net profit 2Bruceleecrouchingtigerhiddendragon.0 billion yuan, an increase of 1%, the growth rate was higher than income, mainly due to the receipt of more government subsidies (about 150 million, YoY+0.8 billion); deduction of non-return net profit of 87 million yuan, down 39%. 2024Q1's net profit per ton deducted from non-return is 95 yuan and YoY-61 yuan, which is expected to increase mainly from the production line intelligence. If the R & D expenses are added back on the basis of deducting non-post-profit, the net profit per ton will be 266 yuan and YoY+27 yuan, indicating that the actual operating net profit per ton has rebounded compared with the same period last year. In March, China's manufacturing PMI index rose to 50.8 month-on-month (back to the boom-and-bust line), the domestic manufacturing boom showed a trend of repair, Honglu steel structure orders in the industrial plant steel structure more, before the weak macro expectations of the market is more worried about the manufacturing boom, the company's valuation continues to be under pressure, with the current manufacturing boom, the company's undervaluation is expected to meet the repair power. Gross profit margin rebounded, R & D spending rate increased compared with the same period last year, and cash inflows narrowed. The gross profit margin of 2024Q1 company is 10.6% and 1.3 pct, and the gross profit margin has rebounded significantly. It is expected that the disturbance to the cost caused by the high-price steel inventory in the previous period has been relatively small. During the period, the expense rate is 7.18% quotation 2.54 pct, in which the sales / management / R & D / financial expense rates are YoY+0.04/+0.12/+2.02/+0.36pct respectively. Due to the decline in income and the rigidity of the expenses, all the expense rates have increased, among which the R & D expense rate has increased greatly, mainly due to the increase in R & D investment in the company's production line. The net interest rate of return to the mother is 4.6%, which is 0.6 pct for YoY. Q1 company operating cash flow net inflow of 80 million yuan, year-on-year narrowed 80 million yuan, mainly due to a year-on-year decline in income. The cash-to-cash ratio / cash-to-cash ratio is 107%, 96%, and 10pct, respectively. Capacity utilization is expected to further improve, promoting ROE uplink. At present, the company's steel structure production capacity has reached 5 million tons, with an output of 4.49 million tons in 2023, with a capacity utilization rate of 90%. The expansion rate of the company slows down in the short term, and it is expected to improve capacity utilization and reduce the proportion of depreciation and amortization in production costs, which is the focus of the current business work, so as to improve ton net profit and turnover, thereby driving ROE upward. To this end, the company focuses on promoting intelligent transformation of production lines, improving supporting factories, strategic cooperation with raw material suppliers, management information upgrading and other ways to continuously promote capacity release, turnover speed, production cost reduction and efficiency. Among them, in terms of intelligent welding robot, the company currently has the integration ability of ground-track instruction-free intelligent welding workstation, and now the company's top ten production bases have been put into use.BruceleecrouchingtigerhiddendragonA small part of Honglu lightweight intelligent welding robot and its own integrated track-type instruction-free intelligent welding workstation, if laid on a large scale, it is expected to help the company to improve capacity utilization, improve quality and reduce costs. In addition, according to the video number of the company's technology center, the company's welding robots have been sold abroad, of which the lightweight intelligent welding robot sells for 128,000 yuan to 133,000 yuan per unit, and the intelligent welding workstation is exempted from teaching 198,000 yuan per unit, which is expected to contribute profit increment to the company in the future. Investment advice: we predict that the company's homing net profit for 2024-2026 will be 13.0 CAGR 14.8 / 1.68 billion yuan respectively, with an increase of 10%, 14% and 13% (13% for 2023-2026), and the current share price will be 7.6 times PE, maintaining a "buy" rating. Risk tips: capacity construction and capacity utilization rate is lower than expected risk, steel price fluctuation risk, intelligent production line benefit is not as good as expected risk, competition aggravates risk and so on. [disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.

[disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.