Anhui Guangxin Agrochemical (SH:603599) Huaan Securities·2024-06-25 01:30Investment Rating - The investment rating for the company is "Buy" (maintained) [3][8]. Core Views - The report highlights the company's complete industrial chain, which provides cost advantages. The company is accelerating its layout in the pharmaceutical intermediates and new materials sectors, with high value-added products expected to improve overall profitability. However, due to the sluggish pesticide market, the profit forecasts for 2024-2025 have been revised downwards [3][8]. - The expected net profits attributable to the parent company for 2024-2026 are projected to be 1.114 billion, 1.421 billion, and 1.896 billion yuan, respectively, with year-on-year growth rates of -22.6%, +27.6%, and +33.4% [3][19]. Financial Summary - The company's revenue for 2024 is estimated at 5.868 billion yuan, with a year-on-year decrease of 35.3%. The revenue is expected to grow by 10.1% in 2024, 15.6% in 2025, and 14.5% in 2026 [19]. - The gross profit margin is projected to be 32.3% in 2024, increasing to 36.5% by 2026 [19]. - The company's return on equity (ROE) is expected to decline to 10.5% in 2024 but recover to 13.5% by 2026 [19]. - The price-to-earnings (P/E) ratio is forecasted to be 9.18 in 2024, decreasing to 5.91 by 2026 [19]. Market Conditions - The report notes that the pesticide market is currently experiencing low demand due to high inventory levels overseas and industry overcapacity, leading to a continuous decline in product prices. As of June 16, 2024, the agricultural raw material price index was reported at 76.99 points, down 11.4% year-on-year [8][3]. - The company is positioned as a leader in the pesticide sector, with ongoing projects aimed at expanding its product offerings and enhancing its competitive edge [3][8]. Strategic Developments - The company is advancing multiple projects to enhance its industrial chain, including the production of various pesticide products and the establishment of a new project for the production of 40,000 tons of para-aminophenol, which is expected to strengthen its competitive position [3][8]. - The company has a significant capacity for phosgene production, which is crucial for its pesticide and fine chemical applications, and is expected to support future expansion needs [14][3].