得益于合理的订单排期，在海外原材料价格全年走低的不利局面下，越南工厂的毛利率仍呈现逐级修 复。2024 年，越南百隆完成营业收入59.97 亿元，同比增长13.03%；实现净利润5.04 亿元，同比增长 299.91%。截至2024年底，越南工厂产能约占集团总产能的77%。 2024 年毛利率同比回升，净利率有所下降。公司2024 年毛利率为10.20%，同比上升1.55pct。2024 年期 间费用率为 7.05%，同比下降2.01pct，其中，销售费用率0.47%，同比-0.12pct；管理费用率3.70%，同 比-1.09pct；财务费用率1.47%，同比-0.76pct；研发费用率1.41%，同比-0.04pct。公司净利率为5.16%， 同比下降2.13pct。 投资建议：公司作为国内领先的色纺纱生产企业之一，主营业务为色纺纱的研发、生产和销售。深耕色 纺纱行业30 余年，已形成特有的"小批量、多品种、快速反应"经营模式，致力于向客户提供全系列、 多品种、质量可靠的以纯棉品种为主的色纺纱线。预测公司2025-2027 年EPS 分别为0.33 元、0.37 元、 0.40 元，对应PE 分别为14. ...

Investment Rating - The investment rating for the company is "Buy" [5] Core Views - The company achieved a record high revenue of 7.941 billion yuan in 2024, representing a year-on-year increase of 14.9%. However, the net profit attributable to shareholders decreased by 18.6% to 410 million yuan due to a high base of investment income in 2023. The non-recurring net profit turned positive at 220 million yuan, indicating significant improvement in core business profitability [1][5] - The sales volume of colored yarns was the main driver of growth, with a total yarn sales volume of 242,300 tons in 2024, up 11.8% year-on-year. The average selling price increased by 1.5% to 30,200 yuan per ton. The revenue from colored yarns reached 4.056 billion yuan, up 29.1% year-on-year, while the revenue from grey fabric decreased by 1.3% to 3.271 billion yuan [2] - The company's Vietnam base contributed all profits, while domestic operations still incurred losses. The gross profit margin improved to 10.2%, up 1.6 percentage points year-on-year, driven by a higher proportion of colored yarns with better margins. The net profit margin attributable to shareholders was 5.2%, down 2.1 percentage points year-on-year [3] - The company has sufficient overseas production capacity, and profit margins are expected to improve further. The ongoing expansion project in Vietnam aims to increase production capacity by 390,000 spindles, enhancing order-taking capabilities. The company is also investing in equipment upgrades to improve production efficiency [4] Financial Summary - The company is projected to achieve revenues of 8.148 billion yuan, 8.658 billion yuan, and 9.186 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 2.6%, 6.3%, and 6.1%. The net profit attributable to shareholders is expected to be 486 million yuan, 546 million yuan, and 609 million yuan for the same years, with growth rates of 18.4%, 12.5%, and 11.5% [10]

Core Viewpoint - The company's 2024 performance fell short of expectations, with revenue growth driven by increased sales volume, but net profit declined significantly due to domestic business challenges [1][2]. Financial Performance - In 2024, the company reported revenue of 7.941 billion, a year-on-year increase of 14.9%, while net profit attributable to shareholders was 410 million, a year-on-year decrease of 18.6%. The non-recurring net profit was 220 million, marking a return to profitability [1]. - For Q4 2024, revenue was 1.867 billion, a year-on-year increase of 2.5%, with a net profit of -2.49 million, showing a reduction in losses compared to the previous year [1]. - The company plans to distribute a cash dividend of 0.26 per share, with a payout ratio of 95.1% [1]. Revenue Breakdown - The company’s yarn sales volume increased by 11.8% to 242,300 tons, with an average price increase of 1.5% to 30,200 per ton [1]. - Revenue from colored yarn and grey fabric was 4.056 billion and 3.271 billion respectively, with year-on-year changes of +29.1% and -1.3% [1]. - Domestic and overseas revenues were 1.902 billion and 5.425 billion respectively, with year-on-year increases of 5.6% and 16.5% [1]. - Notably, revenue from the Vietnam operation increased by 13.0% to 5.997 billion, with net profit soaring by 299.9% to 504 million, significantly outperforming domestic operations [1]. Profitability Metrics - The gross margin improved by 1.6 percentage points year-on-year to 10.2% in 2024, driven by higher capacity utilization and an increased proportion of high-margin colored yarn [2]. - The gross margins for colored yarn and grey fabric were 11.2% and 6.6% respectively, while domestic and overseas gross margins were 2.3% and 11.6% [2]. - In Q4 2024, the gross margin was 6.3%, up 3.6 percentage points year-on-year but down 7.7 percentage points from Q3 2024 due to year-end inventory impairment and bonus payments [2]. Cost Management and Cash Flow - The company effectively controlled expenses, with sales, management, and financial expense ratios decreasing year-on-year to 0.5%, 3.7%, and 1.5% respectively [2]. - The financial expense ratio declined mainly due to a reduction in borrowing and increased foreign exchange gains [2]. - Operating cash flow net amount increased by 71.0% year-on-year to 1.383 billion, indicating strong cash flow performance [2]. Market Outlook - The uncertainty brought by U.S. tariff policies may impact terminal demand and create a wait-and-see attitude among downstream garment manufacturers, potentially affecting short-term orders for the company [3]. Earnings Forecast and Valuation - Due to uncertainties from U.S. tariff policies, the company’s 2025 earnings forecast was lowered by 29.5% to 451 million, with a new 2026 forecast of 497 million [4]. - The current stock price corresponds to P/E ratios of 16.2x and 14.7x for 2025 and 2026 respectively [4]. - The target price is maintained at 5.57, corresponding to P/E ratios of 18.5x and 16.8x for 2025 and 2026, indicating a potential upside of 14% from the current stock price [4].

Core Viewpoint - The company reported a mixed performance in 2024, with revenue growth but a decline in net profit, while also indicating improvements in operational efficiency and product quality through ongoing investments in equipment upgrades [1][3]. Financial Performance - In Q4 2024, the company achieved revenue of 1.9 billion yuan, a year-on-year increase of 2%, and a net profit attributable to shareholders of -0.02 billion yuan, marking a 95% reduction in losses [1]. - For the full year 2024, the company reported total revenue of 7.941 billion yuan, a year-on-year increase of 14.86%, with yarn sales reaching 242,300 tons, up 11.84%, both setting historical highs [1]. - The annual net profit attributable to shareholders was 410 million yuan, a decrease of 18.62% compared to the previous year, primarily due to a high investment income base in the prior year; however, the net profit after deducting non-recurring items was 220 million yuan, indicating a turnaround from losses [1]. Product Performance - In 2024, revenue from colored yarn reached 4.1 billion yuan, up 29% year-on-year, with a gross margin of 11.22%, down 1.60 percentage points; revenue from grey fabric was 3.3 billion yuan, down 1% year-on-year, with a gross margin of 6.60%, up 4.19 percentage points [1]. Dividend Policy - The company plans to distribute a cash dividend of 2.6 yuan per 10 shares (including tax), resulting in a cash dividend payout ratio of 95.05%. Additionally, the board plans to implement a mid-term dividend in 2025 [1]. Regional Performance - In 2024, domestic revenue was 1.9 billion yuan, a year-on-year increase of 6%, while overseas revenue reached 5.4 billion yuan, up 17% year-on-year [2]. - The global textile and apparel industry is recovering from the 2023 inventory destocking cycle, with increasing consumer demand, particularly in developed economies [2]. Equipment Upgrades - The company has invested over 200 million yuan in equipment upgrades, with approximately 30 million yuan allocated to domestic factories and about 188 million yuan to the Vietnam factory, enhancing production efficiency and product quality [3]. - The Vietnam factory achieved revenue of 5.997 billion yuan in 2024, a year-on-year increase of 13.03%, and a net profit of 504 million yuan, up 299.91% [3]. Earnings Forecast - Based on the 2024 performance, the company has adjusted its earnings forecast, expecting EPS of 0.30 yuan, 0.33 yuan, and 0.36 yuan for 2025-2027, down from previous estimates of 0.40 yuan for both 2025 and 2026 [4].

Investment Rating - The investment rating for the company is "Hold" [6] Core Views - The company reported a revenue of 7.94 billion yuan for 2024, representing a year-on-year growth of 14.86%. The annual yarn sales volume reached 242,300 tons, an increase of 11.84%, both achieving historical highs. The net profit attributable to the parent company was 410 million yuan, a decrease of 18.62% compared to the previous year, primarily due to a high base of investment income from the previous year. The net profit after deducting non-recurring items turned from a loss to a profit at 220 million yuan, indicating a significant improvement in the core business profitability [1][4] Revenue Breakdown - In 2024, the company achieved domestic revenue of 1.9 billion yuan, a year-on-year increase of 6%, while overseas revenue reached 5.4 billion yuan, up 17% year-on-year. The global textile and apparel industry is gradually emerging from the inventory destocking cycle of 2023, with consumer demand gradually releasing [2] Product Performance - The revenue from colored yarn in 2024 was 4.1 billion yuan, an increase of 29% year-on-year, with a gross margin of 11.22%, down 1.60 percentage points. The revenue from grey fabric was 3.3 billion yuan, a slight decrease of 1% year-on-year, but the gross margin improved by 4.19 percentage points to 6.60% [1] Dividend Policy - The company plans to distribute a cash dividend of 2.6 yuan per 10 shares (including tax), resulting in a cash dividend payout ratio of 95.05%. Additionally, the board plans to implement a mid-term dividend in 2025 [1] Equipment Upgrade Investment - The company has increased its investment in equipment upgrades, with total investments exceeding 200 million yuan. The investment in domestic factory upgrades was approximately 30 million yuan, while the investment in the Vietnam factory was about 188 million yuan, significantly enhancing production efficiency and product quality [3] Financial Forecast Adjustments - Based on the performance in 2024, the earnings per share (EPS) forecasts for 2025-2027 have been adjusted to 0.30 yuan, 0.33 yuan, and 0.36 yuan respectively, down from previous estimates of 0.40 yuan for both 2025 and 2026 [4]

Investment Rating - The investment rating for the company is "Hold" [6] Core Views - The company achieved a revenue of 7.94 billion yuan in 2024, representing a year-on-year growth of 14.86%. The annual yarn sales volume reached 242,300 tons, an increase of 11.84%, both hitting historical highs. The net profit attributable to the parent company was 410 million yuan, a decrease of 18.62% compared to the previous year, primarily due to a high base of investment income from the previous year. The net profit after deducting non-recurring items was 220 million yuan, indicating a significant improvement in the main business profitability [1][4] - The company plans to distribute a cash dividend of 2.6 yuan per 10 shares (including tax), resulting in a cash dividend payout ratio of 95.05%. Additionally, the board plans to implement a mid-term dividend in 2025 [1] - The company has increased its equipment renovation investment, with total investments exceeding 200 million yuan. The renovation in the domestic factory was about 30 million yuan, while the investment in the Vietnam factory was approximately 188 million yuan, effectively enhancing production efficiency and product quality [3] Summary by Sections Financial Performance - In Q4 2024, the company achieved a revenue of 1.9 billion yuan, a year-on-year increase of 2%, while the net profit attributable to the parent company was a loss of 0.02 billion yuan, a reduction in loss of 95% [1] - The revenue from color-spun yarn reached 4.1 billion yuan, up 29% year-on-year, with a gross margin of 11.22%, down 1.60 percentage points. The revenue from grey fabric was 3.3 billion yuan, down 1% year-on-year, with a gross margin of 6.60%, up 4.19 percentage points [1] Regional Performance - The company generated 1.9 billion yuan in revenue domestically, a year-on-year increase of 6%, while overseas revenue was 5.4 billion yuan, a year-on-year increase of 17% [2] - The global textile and apparel industry is gradually emerging from the inventory reduction cycle of 2023, with consumer demand gradually releasing. For instance, U.S. apparel imports reached 93.96 billion USD, a year-on-year increase of 3.2% [2] Production Capacity and Investment - The company has continued to increase its investment in equipment renovation, with over 200 million yuan invested. The Vietnam factory's revenue reached 5.997 billion yuan, a year-on-year increase of 13.03%, with a net profit of 504 million yuan, a year-on-year increase of 299.91% [3] - As of the end of 2024, the production capacity of the Vietnam factory accounted for approximately 77% of the group's total capacity [3] Earnings Forecast - Based on the performance in 2024, the earnings forecast has been adjusted, with expected EPS for 2025, 2026, and 2027 being 0.30 yuan, 0.33 yuan, and 0.36 yuan respectively [4]

Event Overview - In 2024, the company's revenue, net profit attributable to shareholders, net profit excluding non-recurring items, and net operating cash flow are projected to be 7.941 billion, 410 million, 220 million, and 1.383 billion yuan respectively, with year-on-year growth of 14.86%, -18.62%, 1128.03%, and 70.98% [1] - The higher operating cash flow compared to net profit is mainly due to high depreciation and an increase in operating payables, with non-recurring gains from the disposal of non-current assets amounting to 124 million yuan [1] - Revenue exceeded expectations due to a rapid recovery in colored yarn, while net profit fell short of market expectations primarily due to losses in Q4 [1] Dividend and Financial Management - A cash dividend of 2.6 yuan per 10 shares is proposed for 2024, corresponding to a dividend payout ratio of 95% (up from 89% in 2023) and a dividend yield of 5% [2] - The company plans to limit the maximum margin for cotton futures trading to 990 million yuan for the next 12 months [2] Regional Performance - Revenue from Vietnam and domestic markets for 2024 is expected to be 5.997 billion and 1.902 billion yuan, with year-on-year growth of 13.03% and 5.6% respectively [3] - Vietnam's net profit is projected to be 504 million yuan, a year-on-year increase of 299.91%, with a net profit margin of 8.4% [3] - The company continues to invest in expanding production capacity in Vietnam, with a total capacity of 1.26 million spindles [3] Production and Sales Metrics - Total yarn production and sales are expected to be 254,200 and 242,300 tons, with year-on-year growth of 19.23% and 11.84% respectively [3] - The estimated capacity utilization rate is 104.6%, an increase of 16.9 percentage points year-on-year, with an average selling price of 32,400 yuan per ton [3] Profitability Analysis - The company's gross margin for 2024 is projected to be 10.2%, an increase of 1.55 percentage points year-on-year, driven by improved capacity utilization [4] - The net profit margin is expected to be 5.17%, a decrease of 2.12 percentage points year-on-year [4] - The company has seen a decrease in various expense ratios, with management expenses declining due to reduced employee compensation [4] Inventory and Receivables - As of the end of 2024, inventory is expected to be 4.243 billion yuan, a decrease of 10% year-on-year, with raw materials and in-transit goods accounting for 62% [6] - Accounts receivable are projected to be 690 million yuan, an increase of 12% year-on-year, while accounts payable are expected to rise by 75% to 387 million yuan [6] Investment Outlook - The company is expected to see improved profitability due to the increasing share of colored yarn and recovery in Vietnam's profitability [7] - Long-term growth prospects remain strong, with ongoing expansion in Vietnam and an attractive dividend yield of 5% [7] - Revenue and net profit forecasts for 2025-2026 have been adjusted downward, with new projections for 2027 introduced [7]

Investment Rating - The investment rating for the company is "Outperform the Market" [6][4][35] Core Views - The company is expected to achieve a revenue growth of 15% in 2024, with a non-GAAP net profit turning positive [1] - The increase in the proportion of colored yarn and improved capacity utilization in Vietnam are key drivers for profit recovery [4][35] - Despite potential pressures from raw material price declines, the company anticipates that the increased share of colored yarn will help mitigate some negative impacts [4][35] Summary by Sections Financial Performance - In 2024, the company is projected to generate operating revenue of 79.41 billion yuan, reflecting a year-on-year increase of 14.9%, with yarn sales reaching 242,300 tons, up 11.8% [1] - The gross profit margin is expected to improve by 1.55 percentage points to 10.20% due to order recovery and increased colored yarn sales [1] - The company plans to distribute a dividend of 2.6 yuan per 10 shares, resulting in a payout ratio of 95.05% [1] Quarterly Performance - In Q4, the company reported revenue of 1.867 billion yuan, a 2.5% increase year-on-year, but faced a gross margin decline due to increased wage provisions [2] - The net profit for Q4 was a loss of 2.49 million yuan, although the loss was narrower compared to the previous year [2] Segment Analysis - Revenue from colored yarn increased by 29.1% to 4.056 billion yuan, accounting for 55% of total revenue, while gross margin for this segment was 11.22% [3] - The Vietnam base contributed 5.997 billion yuan in revenue, with a net profit of 504 million yuan, marking a significant improvement [3] Profit Forecast - The company has revised its profit forecasts downward due to uncertainties in tariff policies and declining cotton prices, projecting net profits of 460 million yuan, 540 million yuan, and 640 million yuan for 2025, 2026, and 2027 respectively [4][35] - The expected growth rates for net profit are 12.8%, 16.7%, and 19.1% for the years 2025, 2026, and 2027 [4][35] Valuation Metrics - The company’s earnings per share (EPS) for 2024 is projected at 0.27 yuan, with a price-to-earnings (P/E) ratio of 18.4 [5][36] - The return on equity (ROE) is expected to be 4.3% in 2024, with a gradual increase in subsequent years [5][37]

Investment Rating - The investment rating for the company is "Outperform the Market" [6][4][35] Core Views - The company is expected to achieve a revenue growth of 15% in 2024, with a non-recurring net profit turning positive, reaching 2.20 billion yuan compared to a loss of 0.21 billion yuan in 2023 [1][4] - The company is the second-largest color-spun yarn manufacturer globally, benefiting from an increase in color-spun yarn sales and improved capacity utilization in Vietnam [1][4] - The gross margin is projected to improve by 1.55 percentage points to 10.20% in 2024, driven by order recovery and a higher proportion of color-spun yarn [1][4] Summary by Sections Financial Performance - In 2024, the company is expected to generate operating revenue of 79.41 billion yuan, an increase of 14.9%, with yarn sales reaching 242,300 tons, up 11.8% [1][4] - The gross profit margin is anticipated to rise to 10.20%, with a significant reduction in expense ratio by 2.01 percentage points to 7.05% [1][4] - The company plans to distribute a dividend of 2.6 yuan per 10 shares, with a payout ratio of 95.05% [1] Quarterly Performance - In Q4, the revenue was 1.867 billion yuan, a 2.5% increase year-on-year, but the gross margin decreased due to additional wage provisions for the Vietnam factory [2] - The net profit for Q4 was a loss of 2.49 million yuan, although the loss was narrower compared to previous periods [2] Business Segments - Color-spun yarn revenue increased by 29.1% to 40.56 billion yuan, accounting for 55% of total revenue, while gross margin for this segment was 11.22% [3] - The Vietnam base contributed significantly, with revenue of 59.97 billion yuan and a net profit of 5.04 billion yuan, reflecting a 299.9% increase [3] Future Outlook - The company expects continued improvement in profitability due to higher color-spun yarn sales and operational efficiency in Vietnam, despite potential short-term disruptions from tariff uncertainties [4][35] - The profit forecast for 2025-2027 has been adjusted to 4.6 billion, 5.4 billion, and 6.4 billion yuan respectively, reflecting a growth of 12.8%, 16.7%, and 19.1% [4][35]

Summary of Baolong Oriental Conference Call Company Overview - Baolong Oriental achieved a record yarn sales volume of 242,000 tons in 2024, but the net profit attributable to shareholders decreased by 18.62% to 410 million yuan, primarily due to the impact of subsidiary equity transfer gains, leading to pressure on core business profits [2][3][4] - The company reported a revenue of 7.941 billion yuan, a year-on-year increase of 14.86% [3] Financial Performance - The net profit after deducting non-recurring items was 220 million yuan, indicating a turnaround from losses, with the Vietnamese factory showing significant recovery in profitability [2][3] - The domestic sales gross margin was only 2.29%, while the overseas sales gross margin reached 11.6% [3] - The gross margin for colored yarn was 16.67%, and for grey fabric, it was 6.6% [3] Impact of Tariffs - The U.S. tariffs imposed in April significantly affected Baolong Oriental's order intake, with a cautious approach from downstream garment factories, limiting orders to essential needs [5][6] - 77% of the company's production capacity is located in Vietnam's bonded zone, minimizing direct tariff impacts, but U.S. market exports remain affected [5][6] - Downstream garment factories are seeking orders from Europe and Japan to compensate for potential losses in the U.S. market, leading to increased competition in these regions [6][7][8] Market Conditions - The textile and apparel industry in Vietnam is experiencing weak order feedback for Q2, with heavy customer hesitation [9] - If a trade agreement is reached between Vietnam and the U.S., average tariffs may stabilize around 10%, potentially releasing blocked orders [9] - The company anticipates that cost pressures will normalize based on commercial negotiations, with pricing power dependent on order saturation [12] Future Outlook - The company holds a bearish outlook on cotton prices, expecting a decline due to reduced imports of U.S. cotton in China [22] - The company plans to maintain a high cash dividend payout ratio of 95% and has announced additional interim dividends [22] - The company is also focused on optimizing domestic production capacity due to the uncertain tariff environment, potentially leading to further adjustments in domestic operations [15][16] Production and Capacity - The Vietnamese factory's production capacity is expected to remain at 1.26 million spindles by the end of 2024, with potential increases if orders normalize in 2025 [23][24] - The domestic colored yarn business is underperforming, with gross margins between 2% and 3%, while the Vietnamese subsidiary reported profits of 500 million yuan [4][14] Recommendations for Industry Development - The management suggests that improving domestic demand and consumption capacity is crucial for enhancing the overall industry landscape, especially in light of the significant impact of U.S. tariffs on global markets [26]