Leshan Giantstar Farming&Husbandry (SH:603477) Guoxin Securities·2024-07-12 00:01Investment Rating - The investment rating for the company is "Outperform the Market" (maintained) [1][5][10] Core Views - The company, Juxing Agriculture, is expected to see a profit reversal in H1 2024, benefiting from the recovery in pig prices, with a projected net profit loss of between 49 million to 32 million yuan, compared to a loss of 348.32 million yuan in the same period last year [4][5][6] - The company’s pig farming business has achieved cost reduction and efficiency improvements, leading to a turnaround in profitability, while the leather business has faced challenges due to weak downstream market demand [5][6] - The company is positioned as a quality growth stock in the new pig cycle, with a significant increase in pig output expected, projecting 1.09 million pigs in H1 2024, a 25% increase year-on-year [5][6][10] Summary by Sections Financial Performance - The company forecasts a net profit loss of 49 million to 32 million yuan for H1 2024, with a non-recurring net profit loss of 24 million to 16 million yuan, indicating a reduction in losses compared to the previous year [5][6] - For Q2 2024, the company anticipates a net profit of 89.05 million to 106.05 million yuan, marking a return to profitability [5][6] Business Segments - The pig farming segment is expected to continue expanding, with a projected output of 3.3 million pigs from 2024 to 2026, benefiting from improved breeding and management practices [10][12] - The feed business is expected to maintain steady growth, with revenue projections of 4.62 billion yuan in 2024, increasing to 5.64 billion yuan by 2026 [10][12] Growth Projections - Revenue for the pig farming business is projected to reach 56.85 billion yuan in 2024, with a growth rate of 64.18% [12][13] - The overall revenue for the company is expected to be 62.67 billion yuan in 2024, with a gross margin of 18.65% [12][13] Cost Management - The company has demonstrated strong cost control capabilities, with expectations for continued cost reductions in the pig farming segment due to improved utilization rates and health management [10][12] - The average selling price for pigs is projected to be 16.8 yuan per kilogram in 2024, reflecting a cautious adjustment based on market conditions [10][12]