Event description
CSI released its 2023 annual report and 2024 first quarter report. In 2023, the company realized a revenue of 51.31 billion yuan, up 8% year on year; Net profit attributable to parent company was 2.903 billion yuan, up 35% year on year; In 2023Q4, the revenue will reach 12.191 billion yuan, down 14% year on year and 6% month on month; Net profit attributable to parent company was 63 million yuan, down 93% year on year and 93% month on month; In 2024Q1, the revenue reached 9.597 billion yuan, down 19% year on year and 21% month on month; The net profit attributable to the parent company was 579 million yuan, down 37% year on year and up 815% month on month; Non net profit deducted was 638 million, down 23% year on year and up 132% month on month.
Event comments
In 2023, the company will ship 30.7GW of components, up 45% year on year. In terms of market, the top three companies in terms of annual revenue were America, China and Europe, of which European shipments grew by 24% year on year and the United States by 28%. The annual net profit per watt of the company's components remained at a good level, among which Q4 is expected to be near the break even point, following the industry trend. The annual energy storage shipment of the company was 1.9GWh, which was in line with the expectation, and the revenue was confirmed as 1.1GWh. The remaining revenue will be confirmed in 2024, with the gross margin exceeding 17%, an increase of 5.1 pct year on year, mainly benefiting from the decline in the price of raw materials and the enhancement of scale effect.
In 2024Q1, the company shipped about 6.3GW of components (North America accounted for more than 20%), which is expected to decline on a month on month basis, mainly because the company considered the current market price level and made a balance between volume and profit. The optimization of product structure and market structure has supported the company's Q1 profit level to be better than expected. The net profit per watt is expected to be at the leading level in the industry. It is expected that the company's Q1 component profit will mainly come from the U.S. market. At the same time, the company's Q1 energy storage revenue was 1GWh, a slight increase in the month on month ratio, and the gross profit rate was better than expected, which was also the reason for the decline of raw material prices and scale effect. In 2024Q1, the expense rate is 9.6%, which will increase month on month due to the decrease of income scale. In 2024Q1, the Company suffered an asset impairment loss of 240 million, mainly due to the obsolescence of old battery capacity or the decline in inventory prices. Other income was 90 million, or mainly government subsidies.
Looking forward to the future, the component business, the company actively responds to the current complex situation, consolidate the market and product advantages, the annual shipment is expected to be 42-47GW, of which the proportion of the United States and the proportion of the N-type is expected to increase, the current TOPCon battery efficiency reaches 26%, the yield rate is more than 98%, and the end of the year pull rod/silicon chip/battery/component capacity is expected to reach 50.4/50/56/61GW respectively. The company's 5GW component capacity in the United States is expected to be fully produced within the year, and its profitability will be excellent after enjoying IRA subsidies. For the energy storage business, the orders in hand that have signed the contract at present are 2.6 billion dollars. It is expected to grow explosively in 2024, the system capacity is expected to reach 20GWh by the end of the year, the annual shipment is expected to be 6.0-6.5GWh, and the gross margin is expected to continue to perform well, becoming the second growth curve of the company.
We expect the company to achieve profits of 4 billion and 5.9 billion respectively from 2024 to 2025, corresponding to PE of 11 and 8 times. Maintain the "buy" rating.
Risk warning
1. Deterioration of competition pattern;
2. The PV installation was not as expected.
