Core Viewpoint - The report from CICC maintains the profit forecast for Dekang Agriculture (02419) for 2025/26, with the current stock price corresponding to P/E ratios of 11.5 and 6.7 for those years. The target price is raised by 68% to HKD 111, indicating a potential upside of 28% from the current price, supported by the company's continued growth and improved trading liquidity [1] Group 1 - The company adopts a "company + farmer" light asset development model, with the second farm's sow breeding model achieving the lowest costs within the system. The current operational model distribution is 20% self-operated, 60% first farm, and 20% second farm, with the average annual income for contracted farmers reaching RMB 770,000, a historical high for the company [2] - The second farm model has lower breeding costs compared to the first farm and self-operated models, enhancing operational efficiency and farmer engagement [2] Group 2 - The company continues to reduce costs, maintaining its position as an industry leader. The monthly total cost is reported to be below RMB 12.5 per kilogram, attributed to a focused breeding strategy in the Southwest region, technological empowerment, and efficient management practices [3] - The company expects to achieve a pig output of 11 million and 15 million heads in 2025 and 2026, respectively, with long-term potential exceeding 30 million heads [3] Group 3 - Liquidity has improved significantly, with an average turnover rate of 1.9% since the release of the 2024 annual report, and average daily trading volume increasing to RMB 140 million from RMB 3.69 million year-on-year. The proportion of Hong Kong Stock Connect has also risen [4] - The valuation of the company is expected to increase, with a calculated average market value of RMB 2,528 per head, indicating a 22% potential increase compared to industry leaders [4]
中金：升德康农牧(02419)目标价至111港元 维持“跑赢行业”评级