Shandong Sinocera Functional Material (SZ:300285) Guotai Junan Securities·2024-07-04 14:01Investment Rating - The report maintains a "Buy" rating for the company [3][5]. Core Views - The company's Q2 2024 performance met expectations, with a projected net profit of 3.3 billion to 3.5 billion yuan for H1 2024, representing a year-on-year increase of 3.46% to 9.73% [3]. - The growth in catalytic materials and precision ceramics is expected to continue, with the latter being a breakout year for production [2][3]. - The company is well-positioned for multi-product growth, with significant advancements in its overseas business in biomedical and MLCC sectors [3]. Financial Summary - The company forecasts net profits for 2024 to be 756 million yuan, 914 million yuan, and 1.132 billion yuan for 2024, 2025, and 2026 respectively, with corresponding EPS of 0.76, 0.92, and 1.14 yuan per share [4]. - Revenue is projected to grow from 3.859 billion yuan in 2023 to 4.747 billion yuan in 2024, reflecting a year-on-year increase of 23% [4]. - The company’s net profit margin is expected to improve, with a net profit margin of 16.6% in 2023 and projected to rise to 18.3% by 2026 [4]. Market Position and Developments - The company is expanding its production capabilities, including a 150 million yuan investment in a new project aimed at enhancing production efficiency and entering new high-end ceramic applications [3]. - The company’s stock price has fluctuated between 16.43 and 31.00 yuan over the past year, with a current price of 17.41 yuan [6]. - The total market capitalization is approximately 17.359 billion yuan, with a P/E ratio of 30.50 for 2023 and a projected P/E of 22.95 for 2024 [6][9].