创新驱动 打造智能应用标杆场景 "创新是数字化转型的核心驱动力，我们在生产与营销两端积极构建智能应用标杆场景。"心连心集团数 智化中心总监樊慧峰说。 据介绍，在生产端，依托心连心智能制造平台，融合5G、物联网、大数据技术，实现人、机深度互 联，动态管控与智能决策并举。通过实时数据采集与分析，生产过程中的各项参数得以精准监控和优化 调整，提高了生产效率和产品质量，保障"安、稳、长、满、优"高效运行。 在营销端，心连心集团积极响应国家政策，大力推进数字农业建设。通过水肥一体化运营子系统，融合 新一代卫星遥感影像、大数据等信息化技术，以地块单元为中心，构建"省—市—县—乡"四级穿透的农 业基础大数据平台，涵盖耕地面积、农户、土壤肥力、区域种植结构、气候趋势等多维度数据，让农民 足不出户就能种地、施肥。 在化工产品正由基础原料向高端新材料方向延伸的当下，老牌煤化工企业如何加快数字化转型？ 在河南省政府日前召开的加快数字化转型推动制造业高质量发展工作推进会上，河南心连心化学工业集 团股份有限公司（简称心连心集团）负责人给出了他们的答案——探索和实践创新驱动、技术赋能和生 态协同，围绕"1+6+N"数字化架构（1个工业互 ...

Investment Rating - The report assigns a "Buy" rating for China Heart Heart Fertilizer (1866.HK) for the first time [1]. Core Views - The company has demonstrated stable expansion in its main business, with significant investment value highlighted [1]. - The sale of coal mine assets has led to a notable increase in net profit, with a reported increase of approximately 740 million RMB in investment income from the disposal of stakes in coal mining companies [5]. - The urea business has shown resilient growth despite a decrease in product prices, with production volume increasing by 21% and sales volume by 29%, resulting in a revenue of approximately 7.306 billion RMB, a year-on-year growth of about 6.3% [6]. - The company has prioritized shareholder returns, achieving a record high dividend of 0.25 RMB per share for the fiscal year 2024, with a dividend payout ratio of 22.14% and a dividend yield of 6.7% [7]. - The earnings forecast for 2025-2027 indicates revenues of 24.767 billion, 29.502 billion, and 34.578 billion RMB respectively, with corresponding EPS of 0.9, 1.5, and 2.1 RMB, suggesting a low PE ratio of 4.5, 2.9, and 2.1 times [8]. Summary by Sections Market Performance - The company’s stock price is currently at 4.52 HKD, with a total market capitalization of 5.8 billion HKD and a 52-week price range of 3.36-4.79 HKD [1]. Financial Performance - In 2024, the company reported a total revenue of 23.128 billion RMB, a slight decline of 1.48% year-on-year, while net profit attributable to shareholders increased by 22.96% to 1.459 billion RMB [4]. - The financial projections indicate a gradual increase in revenue and net profit over the next three years, with a significant expected growth rate in 2026 and 2027 [10][11]. Dividend Policy - The company plans to maintain a dividend payout ratio of no less than 25% from 2025 to 2027, reinforcing its commitment to shareholder returns [7].

Core Viewpoint - The company experienced a decline in net profit in Q1 2025, but long-term value remains intact, with projected net profits increasing significantly from 2025 to 2027 [1][3]. Financial Performance - In Q1 2025, the company reported revenue of 5.85 billion yuan, a year-on-year increase of 1.7%, while net profit was 200 million yuan, a decrease of 30% year-on-year [1]. - Urea revenue was 1.54 billion yuan with a sales volume of 965,000 tons, maintaining year-on-year levels, but the price decreased by 23% to 1,592 yuan/ton, leading to a gross margin drop of 13 percentage points to 18% [2]. - Compound fertilizer revenue reached 1.56 billion yuan with a sales volume of 600,000 tons, a 14% increase year-on-year, but the price fell by 4% to 2,599 yuan/ton, maintaining a gross margin of 14% [2]. - Methanol revenue was 800 million yuan with a sales volume of 354,000 tons, a 22% increase year-on-year, with the price rising by 4% to 2,270 yuan/ton and a gross margin increase of 4 percentage points to 10% [2]. - Melamine revenue was 160 million yuan with a sales volume of 32,000 tons, a 7% decrease year-on-year, with the price down by 18% to 5,106 yuan/ton and a gross margin drop of 21 percentage points to 22% [2]. - DMF revenue was 290 million yuan with a sales volume of 78,000 tons, a 9% increase year-on-year, with the price decreasing by 9% to 3,668 yuan/ton and a gross margin increase of 4 percentage points to 16% [2]. Industry Outlook - The demand for urea in China is projected to be 69 million tons in 2025, with agricultural demand at 43 million tons (3% growth) and industrial demand at 22 million tons (5% growth), while export volume is expected to reach 4 million tons, a significant increase of 1,438% [3]. - Changes in export policy from comprehensive restrictions to structured regulation are anticipated to alleviate domestic urea supply surplus, with total export quotas not exceeding 4.25 million tons in 2023 and a defined export window from May to September [3]. Investment Recommendation - The company maintains a target price of 6.5 HKD, representing a 49% upside potential based on a projected P/E ratio of 7.4 times for 2025, with expected net profits of 1 billion, 1.76 billion, and 2.6 billion yuan for 2025, 2026, and 2027 respectively [1][3].

Core Viewpoint - China Heart Heart Fertilizer reported a mixed performance in Q1, with revenue growth but a significant decline in net profit, indicating challenges in the fertilizer market and the need for strategic adjustments [1][2][3] Financial Performance - The company achieved revenue of approximately 5.846 billion yuan, a year-on-year increase of 1.7% and a quarter-on-quarter increase of 2.4% [1] - The net profit attributable to shareholders was about 198 million yuan, a decrease of 30.03% year-on-year, although it marked a recovery from a loss of approximately 74.64 million yuan in the previous quarter [1] Market Dynamics - The fertilizer market is experiencing a "first suppressed then rising" trend, with prices of coal chemical products remaining low in January and February, followed by a rebound in March due to spring farming demand and improved export expectations [1] - The overall gross margin increased by nearly 3 percentage points to 14% during the period, driven by rising prices of downstream products [1] Segment Performance - The fertilizer segment generated sales revenue of approximately 3.09 billion yuan, accounting for 53% of total revenue, making it the largest revenue source for the company [1] - The chemical segment achieved sales revenue of about 2.46 billion yuan, representing 42% of total revenue, while other segments contributed approximately 290 million yuan, or 5% [1] Product Development and Strategy - The company is enhancing the sales proportion of high-efficiency compound fertilizers, with a 6% increase in sales volume and a 9% increase in product prices, leading to a 2 percentage point rise in gross margin [2] - The gross margin for humic acid reached 25%, supported by ongoing research and development [2] Future Projects - Upcoming projects include a 600,000-ton synthetic ammonia and 1.2 million-ton slow-release fertilizer project in Jiangxi, expected to be operational by Q3 2025, and a 320,000-ton melamine and 500,000-ton high-efficiency compound fertilizer project in Xinjiang, projected for completion by the end of 2026 [2] Market Outlook - The company anticipates an increase in international potassium fertilizer and grain prices due to tariff policies, alongside a shift in domestic agriculture towards precision farming, which will enhance demand for high-efficiency fertilizers [3] - The company plans to leverage policy benefits for technological upgrades and focus on functional, customized products and differentiated services to strengthen its market position as a "proponent of efficient fertilizer use" [3]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 6.5 HKD, indicating a potential upside of 49% from the current price of 4.4 HKD [7]. Core Views - Short-term performance fluctuations do not alter the long-term value of the company, with projected net profits for 2025-2027 expected to be 1.0 billion, 1.76 billion, and 2.6 billion RMB, reflecting a year-on-year change of -32%, +76%, and +48% respectively [4][5]. - The decline in urea prices significantly impacted the company's performance, with a 30% year-on-year drop in net profit for Q1 2025, despite a slight increase in revenue [2][3]. Revenue and Profit Analysis - In Q1 2025, the company achieved revenue of 5.85 billion RMB, a year-on-year increase of 1.7%, while net profit was 200 million RMB, down 30% year-on-year [2][3]. - Urea revenue was 1.54 billion RMB with a sales volume of 965,000 tons, maintaining year-on-year sales but with a price drop of 23% to 1,592 RMB/ton [3]. - Compound fertilizer revenue reached 1.56 billion RMB with a sales volume of 600,000 tons, showing a 14% increase in sales volume but a 4% price decline [3]. - Methanol revenue was 800 million RMB, with a sales volume of 354,000 tons, reflecting a 22% increase in sales volume and a 4% price increase [3]. Market Demand and Export Policy - The report anticipates a total demand for urea in China of 69 million tons in 2025, with agricultural demand at 43 million tons (3% growth) and industrial demand at 22 million tons (5% growth) [4]. - The export policy for urea has shifted from comprehensive restrictions to a more structured control, allowing for a total export quota of 4.25 million tons in 2025, which is expected to alleviate domestic supply issues [4].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 6.5, indicating a potential upside of 49% from the current price of HKD 4.4 [7]. Core Views - Short-term performance fluctuations do not alter the long-term value of the company, with projected net profits for 2025-2027 expected to be RMB 1.0 billion, RMB 1.76 billion, and RMB 2.6 billion, respectively, reflecting a year-on-year change of -32%, +76%, and +48% [4][5]. Revenue and Profit Analysis - In Q1 2025, the company achieved revenue of RMB 5.85 billion, a year-on-year increase of 1.7%, while net profit was RMB 200 million, down 30% year-on-year [2][4]. - Urea revenue was RMB 1.54 billion with a sales volume of 965,000 tons, maintaining year-on-year levels, but the price decreased by 23% to RMB 1,592 per ton, leading to a gross margin drop of 13 percentage points to 18% [3]. - Compound fertilizer revenue reached RMB 1.56 billion with a sales volume of 600,000 tons, a 14% increase year-on-year, while the price fell by 4% to RMB 2,599 per ton, maintaining a gross margin of 14% [3]. - Methanol revenue was RMB 800 million with a sales volume of 354,000 tons, a 22% increase year-on-year, and a price increase of 4% to RMB 2,270 per ton, resulting in a gross margin rise of 4 percentage points to 10% [3]. - The company expects a total demand for urea in China to be 69 million tons in 2025, with agricultural demand at 43 million tons and industrial demand at 22 million tons, reflecting growth rates of 3% and 5%, respectively [4]. Market Dynamics - The report highlights that changes in export policies from comprehensive restrictions to structured adjustments will significantly impact demand, with an expected export volume of 4 million tons in 2025, a staggering increase of 1,438% [4]. - The report emphasizes that the relaxation of export policies will help alleviate domestic urea supply surplus issues [4].

Group 1 - The overall fertilizer market is experiencing a "first decline, then rise" trend in Q1 2025, with initial supply-demand mismatches leading to continued low prices for coal chemical products, including urea and melamine [1] - In March, driven by spring farming demand and increased export expectations, urea prices rebounded quickly, positively impacting downstream product prices [1] - The company's overall gross margin decreased by 4 percentage points year-on-year but increased by nearly 3 percentage points quarter-on-quarter to 14%, indicating a rising trend [1] Group 2 - The company's revenue for Q1 reached 5.846 billion yuan, representing a year-on-year growth of 1.7% and a quarter-on-quarter growth of 2.4% [1] - Net profit attributable to shareholders was 197.5 million yuan, with basic earnings per share at 16.3 cents [1] - The company has strengthened cost control, with the proportion of three expenses decreasing by nearly 1 percentage point year-on-year, particularly financial expenses, which fell by 9% [1] Group 3 - Due to the decline in raw coal prices, the support for urea prices weakened, leading to a larger price drop for urea compared to cost reductions, resulting in a 23% year-on-year decline in overall gross margin [2] - However, with improvements in the fertilizer supply-demand landscape, product prices are gradually recovering, leading to a 26% quarter-on-quarter increase in gross margin [2] - The company's net profit, excluding non-recurring items, saw a significant quarter-on-quarter growth of 89%, indicating a stable upward trend in operations [2]

Financial Performance - In Q1 2025, the company's revenue reached RMB 5,845,825,000, representing a year-on-year increase of 1.7% and a quarter-on-quarter increase of 2.4%[4] - The net profit for the same period was RMB 249,372,000, down 35% year-on-year, while the net profit excluding non-recurring items was RMB 266,799,000, also down 30% year-on-year[4] - The overall gross margin decreased by 4 percentage points year-on-year but increased nearly 3 percentage points quarter-on-quarter to 14%[2] - The company achieved a significant reduction in financial expenses, down 9% year-on-year, and improved the average loan interest rate by 0.7 percentage points[3] - The company reported a quarter-on-quarter gross profit increase of 26%, leading to a significant 89% increase in net profit excluding non-recurring items[4] Asset and Debt Management - Total assets increased by 4% to approximately RMB 33,844,128,000 compared to the beginning of the period, driven by a 133% increase in cash and cash equivalents[5] - The company’s debt-to-asset ratio rose to 62.2% from 61.5% at the beginning of the period[5] - The company plans to increase its capital reserves by 2025 to support project construction, anticipating a slight rise in the debt-to-asset ratio, but expects significant improvement in operational cash flow and other indicators by 2027[23] Market Segmentation and Product Focus - The fertilizer segment accounted for 53% of total revenue, while the chemical segment contributed 42%[12] - The company is focusing on the development of high-efficiency fertilizers, particularly humic acid fertilizers, to meet the growing demand in modern agriculture[12] - The demand for water-soluble fertilizers, controlled-release fertilizers, and humic acid-based efficient fertilizers is increasing due to domestic environmental policies and large-scale land cultivation trends, providing a market foundation for the company's high-end fertilizers[24] - The company aims to upgrade its brand positioning to "China's advocate for efficient fertilizers" and promote scientific fertilization methods through a combination of quality products and services[25] Pricing and Sales Volume - Urea price decreased by 23% year-on-year to 1,592, while compound fertilizer price decreased by 4% year-on-year to 2,599, influenced by geopolitical factors and rising raw material costs[14] - Urea sales volume remained stable at 965,000 tons, with a 5% decrease compared to the previous quarter due to fewer effective sales days during the Spring Festival[15][16] - The sales volume of compound fertilizer increased by 14% year-on-year to 599,000 tons, driven by a new marketing model and enhanced production capacity in Guangxi[16] - Methanol price increased by 4% year-on-year to 2,270, supported by improved supply-demand balance and reduced imports from the Middle East by over 50%[14] Production and Project Development - The company is progressing on several projects, including a 600,000-ton ammonia project in Jiangxi, expected to be operational by Q3 2025[22] - The company plans to complete a 320,000-ton melamine project in Xinjiang by 2026, benefiting from lower raw material costs[22] - New production capacities in Xinjiang and Guangxi are expected to contribute to profit growth in the second half of the year[22] Strategic Initiatives - The company is actively expanding into high-end markets and establishing strategic partnerships with leading pesticide companies to secure sales volume[19] - The company is focusing on a strategy of "total cost leadership + differentiated competition" to enhance its national base layout and improve overall gross margin through advanced production processes[23] - The company has implemented a restricted stock incentive plan for employees, marking the first such plan since its listing in 2006, aimed at retaining core talent[7] Market Outlook - The company is expected to benefit from the gradual relaxation of urea export restrictions, which may alleviate domestic supply-demand imbalances and boost market confidence[25] - The gross margin for urea decreased by 13 percentage points year-on-year to 18%, but showed a recovery trend compared to the previous quarter[20] - The gross margin for methanol increased by 4 percentage points year-on-year to 10%, due to optimized production processes and rising selling prices[20]

Business Strategy and Development - The company aims to achieve a market capitalization of 100 billion by establishing three leading brands in fertilisers, melamine, and polyformaldehyde, contributing to its growth strategy [20]. - The Henan base is focused on building a modern chemical park with a goal of enhancing per capita labour efficiency and reducing energy consumption through technological transformation [17]. - The Jiangxi base plans to develop four business sectors: basic chemicals, high-efficiency fertilisers, fine chemicals, and new materials, aiming for industry-leading safety and profitability [19]. - The Xinjiang base targets to become the leading fertiliser brand in the region, with a focus on increasing the quantity and quality of chemical fertilisers and enhancing melamine technology [21]. - The Guangxi base is set to become the most competitive benchmark in South China, concentrating on base construction and industrial chain planning over the next three years [22]. - The company has established scientific research platforms, including the "National Enterprise Technology Centre" and "Postdoctoral Research Station," to support its technology-leading development strategy [34]. - The company reported a commitment to low-cost and differentiated operational strategies to enhance its competitive edge in the fertiliser market [16]. - The company is actively responding to national strategies aimed at increasing efficiency in fertiliser use and promoting soil testing and formula fertilization [34]. - The company has a strategic focus on high-efficiency, high-end, and lean development to solidify its position as a respected fertiliser enterprise in China [15]. - The company emphasizes creating maximum value for society with minimal resources, reflecting its commitment to sustainable development [10]. Financial Performance - Revenue for FY2024 was RMB 23,128 million, a decrease of 1.5% compared to RMB 23,475 million in FY2023 [47]. - Gross profit for FY2024 was RMB 3,931 million, down 6.1% from RMB 4,187 million in FY2023 [47]. - Profit before tax increased by 22.5% to RMB 2,376 million in FY2024, compared to RMB 1,940 million in FY2023 [47]. - Net profit attributable to the parent rose by 23% to RMB 1,459 million in FY2024, up from RMB 1,187 million in FY2023 [47]. - The Group achieved sales revenue of approximately RMB 23,128 million, representing a year-on-year decline of 1% due to declining product prices [97]. - The net profit increased by 23% year-on-year to RMB 2,014 million, with net profit attributable to the parent company also increasing by 23% year-on-year to RMB 1,459 million [97]. Production and Technology - The new large-scale stable urea production unit began operations in February 2024, breaking the monopoly of foreign companies on this technology [52]. - The group standard of "Urea Humic Acid" led by the company passed technical review in May 2024 and was officially promulgated in December [58]. - The company operates under a flexible production mode allowing for adjustments between products, enhancing operational efficiency [40]. - The company was approved for key R&D projects under the national "14th Five-Year" plan for the fourth time in January 2024 [50]. - The Group successfully completed the construction of new projects, including a 60,000 tons polyformaldehyde project and a 300,000 tons compound fertilizer project, enhancing its market capabilities [96]. Market Trends and Challenges - The fertiliser market has entered a downward trend after a high-price phase, prompting the company to enhance its capabilities to cope with market uncertainties [80]. - The fertilizer market is experiencing increased competition due to demand-supply mismatches, environmental pressures, and geopolitical tensions [147][149]. - The rigid demand for fertilizers is expected to steadily grow due to national policies supporting farmland protection and increasing grain yield per unit area [147][149]. - In 2025, domestic nitrogen fertilizer demand and supply is expected to remain stable, with increased sales driven by stronger demand for differentiated products [145]. Employee and Corporate Governance - The Group's employee count increased to 11,787 as of December 31, 2024, up from 10,390 in 2023 [186]. - The Company provides various employee benefits, including medical and life insurance, and discretionary bonuses based on performance [189]. - The Group has complied with all provisions of the Corporate Governance Code during the year ended December 31, 2024 [175]. Shareholder Returns and Dividends - The proposed final dividend is RMB 0.26 per share for the year ended December 31, 2024, an increase from RMB 0.24 per share in 2023, pending shareholder approval [151][156]. - The Company repurchased a total of 6,312,000 shares at a total consideration of HK$24,609,000, representing approximately 0.5% of the issued shares as of December 31, 2024 [180]. - The repurchase of shares was based on the Company's confidence in its long-term business prospects and potential growth [180].

Investment Rating - The report maintains an "Outperform" rating for China XLX Fertiliser with a target price of HK$5.18, based on a current price of HK$3.99 [1][8]. Core Insights - In 2024, the net profit attributable to the parent company increased by 22.96% year-on-year, driven by significant investment income from the sale of a subsidiary [5][6]. - The company achieved a revenue of 23.129 billion yuan in 2024, a slight decrease of 1.48% year-on-year, with a gross profit of 3.931 billion yuan, down 6.12% [5][6]. - The board proposed a dividend policy for 2025-2027 with a distribution ratio of at least 25% of audited net profit attributable to shareholders, and a minimum dividend of 0.24 yuan per share [5][6]. Revenue Breakdown - The fertilizer segment accounted for 58% of total revenue, while the chemical segment contributed 37% in 2024 [6][7]. - Urea revenue increased by 6.3% year-on-year to 7.306 billion yuan, with a sales volume growth of 29% [6][7]. - Compound fertilizers saw a revenue decrease of 2% to 5.994 billion yuan, with a slight sales volume decline of 0.3% [6][7]. - Methanol revenue grew by 14.5% year-on-year to 2.678 billion yuan, with a sales volume increase of 16% [6][7]. Ongoing Projects - The company is progressing with ongoing projects, including a 60,000-tonne polyformaldehyde project and a 300,000-tonne compound fertilizer project, both expected to enhance market presence [7][8]. - Future projects include a 920,000-tonne compound fertilizer and 160,000-tonne melamine facility, expected to start production in early 2027 [7][8]. Earnings Forecast - The earnings forecast for 2025-2027 shows a projected net profit of 1.153 billion yuan in 2025, down 29.95%, followed by 1.611 billion yuan in 2026 and 2.142 billion yuan in 2027 [8][6]. - The target price is set at HK$5.18, based on a PE ratio of 5.3 times for 2025 [8].