The decline in China Liansu's profit was mainly due to an increase in interest expenses due to impairment of customer accounts receivable and rising interest rates on loans in '23.
The Zhitong Finance App learned that Tianfeng Securities released a research report stating that it maintained the “buy” rating of China Liansu (02128) and adjusted the company's 24-25 net profit from 30.95/3.49 billion to 26.2.94 billion yuan in 24-25 years. The estimated net profit to mother for 26 years was 3.36 billion yuan, with a target price of HK$4.62 billion. The company achieved revenue of 30.888 billion yuan for the full year of '23, +0.3% year-on-year; net profit to mother was 2,368 billion yuan, -6.1% year-on-year. The decline in profit was mainly due to an increase in interest expenses due to impairment of customer accounts receivable and an increase in interest rates on loans in '23. Financial expenses were +63.38% compared to the same period last year.
According to the report, Liansu New Energy Sanitary Ware's production base has been put into operation, and an overseas production base will soon be built in Indonesia, which will further increase Liansu New Energy's component production capacity and accelerate overseas market development. At the same time, Liansu New Energy and Süddeutsche Group reached comprehensive cooperation on photovoltaic products to further accelerate Liansu Renewable's expansion overseas. The environmental protection business mainly focuses on the municipal sector, focusing on water environment, aquatic ecology, soil mine treatment and operation, etc., to consolidate the Group's traditional business advantages. The supply chain service platform has accelerated its penetration overseas, focusing on the Southeast Asia region, and is expected to empower the company's main business. The diversified business layout enhances business collaboration and provides new growth momentum for the company's development. The company's balance ratio was good in '23, down 0.82pct from year to year, reaching 37.31%. There is plenty of room for debt, and the company may continue to expand its business layout.