LIHUA(SZ:300761) Donghai Securities·2024-07-25 03:00Investment Rating - The report maintains a "Buy" rating for the company [1] Core Insights - The company has achieved a turnaround in profitability in the first half of 2024, driven by improved cost management in chicken and pig farming [3][6] - The sales volume of yellow feathered chickens increased by 10.7% year-on-year, reaching 235 million, with revenue of 6.682 billion yuan, a growth of 11.4% [5] - The average selling price of yellow feathered chickens was 13.2 yuan/kg, a slight increase of 0.2% year-on-year [5] - The complete cost of raising yellow feathered chickens decreased by 13.48% year-on-year to 12.2 yuan/kg in the first half of 2024, primarily due to lower feed material costs [5] - The company expects continued price recovery for yellow chickens in the second half of the year, contributing to performance growth [5] Summary by Sections Sales and Revenue - In the first half of 2024, the company sold 43.49 million pigs, a year-on-year increase of 18.8%, with revenue of 0.835 billion yuan, up 44.2% [15] - The average selling price of pigs was 15.9 yuan/kg, reflecting a 7.1% increase year-on-year [15] - The company anticipates a total pig output of over 1.2 million for the year, supported by a stable production capacity of 1.8 million pigs [15] Profit Forecast - The company forecasts net profits attributable to shareholders of 0.831 billion yuan for 2024, representing a year-on-year increase of 289.99% [6] - Expected earnings per share (EPS) for 2024, 2025, and 2026 are projected at 1.00 yuan, 2.24 yuan, and 1.54 yuan respectively [6] - The price-to-earnings (P/E) ratios for the next three years are estimated at 23.01, 10.29, and 15.01 times [6] Cost Management - The company has successfully reduced costs in both chicken and pig farming, with significant improvements in profitability expected to continue [6][15] - The complete cost of pig farming decreased from 17.6 yuan/kg in Q1 to 14.8 yuan/kg in Q2 of 2024 [15]