Xianhe(SH:603733) EBSCN·2024-07-09 00:01Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected investment return exceeding 15% over the next 6-12 months [3][10][7]. Core Insights - The company is expected to achieve a net profit attributable to shareholders of 270 to 300 million yuan in Q2 2024, representing a year-on-year increase of 363.4% to 414.7% and a quarter-on-quarter increase of 0.9% to 12% [2]. - The report highlights that the company successfully passed on the rising costs of wood pulp through effective price increases, particularly in the specialty paper sector, which has maintained strong demand [2]. - The company is projected to have a revenue forecast of 116.4 billion yuan for 2024, with net profits expected to reach 10.5 billion yuan, reflecting a slight upward adjustment in profit margins due to cost management capabilities [10]. Financial Summary - The company’s total revenue for 2022 was 7.738 billion yuan, with a projected increase to 11.644 billion yuan in 2024, representing a growth rate of 36.13% [11]. - The net profit for 2022 was 710 million yuan, expected to rise to 1.045 billion yuan in 2024, indicating a growth rate of 57.49% [11]. - The earnings per share (EPS) is projected to be 1.48 yuan in 2024, with a price-to-earnings (P/E) ratio of 12 [11]. Production Capacity and Cost Management - The company plans to launch 800,000 tons of self-supplied pulp capacity in the second half of 2024, which is expected to significantly reduce production costs and provide new profit growth points for 2024 and 2025 [24]. - The report notes that the company has effectively managed wood pulp procurement, resulting in a lower increase in inventory costs compared to the market [2].