The Zhitong Finance App learned that Huacheng Securities released a research report saying that the rapid growth in bus traffic and the resilience of truck traffic in the highway industry will drive the performance of the 23Q4 highway industry to maintain a good growth trend. Major listed companies place importance on shareholder returns. In recent years, many companies have increased their dividend ratio.The dividend rate is attractive.Continue to push the Gan-Guangdong Expressway (600269.SH), etc. The demand side of the port industry will continue its steady growth trend.However, the orderly integration of supply-side regions is the biggest point of interestto maintain the judgment of the industry in a new cycle of steady increase in entry rates. Continue to push for investment promotion ports (001872.SZ), etc.

▍ The main views of Huacheng Securities are as follows:

Highways: Performance continues to improve. Q3 surpassed the same period in 2021 and 2019, and passenger traffic increased rapidly.

1) The road industry achieved revenue of 31.91 billion yuan in 2023Q3, +5.2% year-on-year and +4.5% year-on-month. Revenue increased 15.1% compared to 2021/Q3 and revenue increased 51.1% over 2019 Q3. The 2023Q3 highway industry achieved net profit of 8.31 billion yuan, +11% year-on-year and +9.7% month-on-month. Net profit increased 16.4% from 2021/Q3 and 28.7% from 2019 Q3 revenue.

2) In 2023Q1-3, the highway industry achieved cumulative revenue of 88.53 billion yuan, +7.1% year-on-year; cumulative net profit of 23.73 billion yuan, +18.8% year-on-year.

3) Road passenger traffic increased rapidly. In Q1-3 of 2023, the cumulative road passenger traffic volume was +20.9% year on year; in 2023Q3, road passenger traffic was +25.2% year on year. Road freight volume remained steady. In Q1-3 of 2023, the total road freight volume was 29.74 billion tons, +7.7% year on year; 23Q3 road freight volume was 10.7 billion tons, +8% year on year.

2023Q3 performance of listed highway companies with a market capitalization of 10 billion dollars:

Ning—Shanghai Expressway (1.56 billion yuan, +21.4% yoy) > China Merchants Highway (1.55 billion yuan, +20.2% yoy) > Shandong Expressway (820 million yuan, +10.6% yoy) > Shenzhen Expressway (610 million yuan, -47.9%) > Wantong Expressway (510 million yuan, +0.8%) > Guangdong Expressway A (470 million yuan, +12.8% yoy) > Gan-Yue Expressway (350 million yuan, +151.6% yoy) > Sichuan Chengyu (340 million yuan, +166.3% yoy). Note: The net profit of the Q3 fair value change of the Ganyue Expressway was 42 million yuan, mainly due to profit and loss from changes in the fair value of transactional financial assets.

Port: Q3 revenue and profit both achieved positive year-on-year growth, reversing the downward trend.

1) In 2023Q3, the port industry achieved revenue of 50.825 billion yuan, +0.8%, +1.3% month-on-month. Revenue was generally the same year over year, reversing the year-on-year decline in Q1 and Q2 (2023Q1 revenue -8.5%, +2.9% month-on-month; 2023Q2 revenue -1.9%; 2023Q2 revenue -1.9%, +5.8% month-on-month). The 2023Q3 industry achieved net profit of 11.072 billion yuan, +7.6% year-on-year and +6% month-on-month, and a relatively good profit recovery (2023Q1 profit -14.8%, 2023Q 2-11.3%). 2023Q3 achieved a gross profit margin of 18.3%, +2.5pct year-on-year, the same month-on-month; achieved net profit margin of 21.8%, +1.4pct year-on-year, and +1pct month-on-month, improving profitability.

2) In 2023Q1-3, the port industry achieved operating income of 145.76 billion yuan, -5% year-on-year, and net profit of 30.72 billion yuan, -7.2% year-on-year. Note: Excluding SIPG, 2023Q1-3, the cumulative net profit of the port industry was +10.4%.

3) The growth rate of cargo throughput is higher than that of containers, and the growth rate of crude oil throughput is leading. From January to September 2023, the country's port container throughput was 23.72 million TEU, +5.2% year on year, and cargo throughput was 12.54 billion tons, +8.5% year on year. Main types of goods: Throughput growth rate from January to September 2023, crude oil 10.3% > iron ore 6.1% > containers 5.4% > food 4.7% > coal 4.2%. Major regions: Bohai Rim region, Hebei port leads the total growth rate of cargo throughput; Yangtze River Delta region, Jiangsu leads the growth rate of cargo and container throughput; Pearl River Delta & Southwest China, Guangxi leads the growth rate of cargo and container throughput.

2023Q3 results of major port listed companies:

1) Investment Port, with investment income driving record performance in 23Q3. 2023Q3 achieved operating income of 3.96 billion yuan, -0.28% year-on-year, -3.45% month-on-month, and net profit of 1,247 billion yuan, +62.94% year-on-year, +18.5% month-on-month;

2) Qingdao Port. In 2023Q3, the company achieved revenue of 4.501 billion yuan, a year-on-year decrease of 7.29%, mainly due to fluctuations in logistics and value-added service revenue due to fluctuations in shipping costs; net profit of 1,225 billion yuan was realized, an increase of 7.76% over the previous year;

3) Tangshan Port. In 2023Q3, the company achieved operating income of 1,525 billion yuan, -14.45% year-on-year. It is estimated that revenue will decline due to fluctuations in sales revenue from non-main business products; net profit of 584 million yuan, +17.55% year-on-year.

Risk warning:

The increase in passenger and truck traffic fell short of expectations; port throughput fell short of expectations.