SAILUN GROUP(SH:601058) Changjiang Securities·2024-07-11 01:31Investment Rating - The investment rating for the company is "Buy" and is maintained [5]. Core Views - The company is expected to achieve a net profit attributable to shareholders of 2.12 billion to 2.18 billion yuan in the first half of 2024, representing a year-on-year increase of 102.7% to 108.4%, marking the highest level for the same period in history [2][6]. - The company continues to benefit from its integrated production, research, and development advantages, leading to significant growth in its performance [6][7]. - The "Liquid Gold" tire product has received international recognition for its superior performance and sustainability, with a potential large market space in the future [7]. Summary by Sections Performance Overview - The company reported a substantial increase in net profit for Q2 2024, estimated between 1.09 billion to 1.15 billion yuan, reflecting a year-on-year growth of 57.3% to 66.0% and a quarter-on-quarter increase of 5.1% [2][6]. - The growth is attributed to strong sales across all tire categories, with domestic and international sales increasing by over 30% [6][7]. Product Development - The company has been focusing on the non-road tire business, enhancing its competitiveness through a comprehensive product range and quality [6][7]. - Significant upgrades have been made to the Qingdao factory for non-road tire production, and new capacities are being established in various locations including Vietnam and Indonesia [6][7]. Global Expansion - The company is actively expanding its global production capacity, with projects in Vietnam, Cambodia, and Mexico, aiming to leverage low export tariffs in these regions [7][8]. - By the end of 2023, the company plans to establish a total production capacity of 26 million all-steel tires, 103 million semi-steel tires, and 447,000 tons of non-road tires [7][8]. Financial Projections - The projected net profit attributable to shareholders for 2024, 2025, and 2026 is expected to be 4.49 billion, 5.62 billion, and 6.91 billion yuan respectively [7][11].