wanhua(SH:600309) Xin Lang Cai Jing·2025-08-22 00:24Core Viewpoint - The company is currently experiencing a downturn in both performance and valuation, but there are signs of potential recovery in the global and Chinese markets, particularly for its main products MDI and TDI, which may see an upturn in demand and pricing due to improved supply dynamics and reduced competition [1][7]. Group 1: Market Environment - The global and Chinese chemical industry is facing significant challenges, with major players like Shell, Lanxess, and Dow Chemical exiting capacity, leading to a more favorable supply-side environment [1]. - The Chinese government has emphasized the need to address "involution" in competition, suggesting a potential for improved market conditions [1]. Group 2: MDI Market - MDI is primarily used in home appliances and real estate insulation, with demand supported by the Chinese market and new applications emerging [2]. - Global MDI demand is expected to grow steadily despite fluctuations, with major competitors facing operational pressures [2]. - The industry has high barriers to entry, and the company’s MDI technology has reached its seventh generation, indicating a strong competitive position [2]. Group 3: TDI Market - TDI is in high demand due to a booming domestic furniture industry, with supply constraints from production halts leading to significant price increases [3]. - The favorable supply-demand relationship for TDI is expected to continue, supporting price stability and growth [3]. Group 4: Petrochemical Business - The company has successfully launched a new ethylene plant, enhancing its competitive edge through a fully integrated supply chain [4]. - The company is collaborating with foreign giants for petrochemical projects to ensure stable raw material supply [6]. Group 5: Management and Financial Strategy - The company is focused on cost reduction and capital expenditure control, with a planned investment of 25.24 billion yuan in 2025, indicating a strategic shift towards more efficient operations [6]. - The company is also enhancing its fine chemicals and new materials segments, which are expected to yield significant future growth [6]. Group 6: Investment Outlook - The company maintains a "buy" rating, with expectations of net profits reaching 14.1 billion, 18.45 billion, and 20.22 billion yuan for 2025-2027 [7].