Yuanxing Energy(SZ:000683)2024-07-30 10:03Investment Rating - The report maintains an "Outperform" rating for the company [3][10]. Core Insights - In the first half of 2024, the company's recurring net profit increased by 11.30% year-on-year, with operating income reaching 7.070 billion yuan, a 32% increase compared to the previous year [2][6]. - The Alashan project has secured water rights of 10 million cubic meters per year, which supports its production needs [8][9]. Financial Performance - For 2024H1, the company reported a net profit of 1.209 billion yuan, up 14.90% year-on-year, and a recurring net profit of 1.208 billion yuan, reflecting an 11.30% increase [6][10]. - In Q2 2024, the company achieved operating income of 3.789 billion yuan, a quarter-on-quarter increase of 15.50% and a year-on-year growth of 32.86% [6][10]. Product Segmentation - The company's self-produced soda ash generated operating income of 3.924 billion yuan, a significant increase of 115.03%, with a production volume of 2,719,400 tonnes [7]. - The self-produced baking soda had an operating income of 919 million yuan, with a gross profit margin of 52.79%, and a production volume of 668,200 tonnes [7]. - The self-produced urea reported an operating income of 1.696 billion yuan, down 20.32% year-on-year, with a production volume of 840,200 tonnes [7]. Resource and Technical Advantages - The company possesses significant natural alkali resources, including proven reserves of 193.08 million tonnes at the Anpeng alkali mine and 105.867 million tonnes at the Tamusu natural alkali mine, which is the largest proven natural alkali mine in China [9][10]. - The company utilizes advanced hydrothermal solution mining processes, ensuring environmentally friendly production with no waste liquid emissions [9]. Earnings Forecast - The company is expected to achieve net profits of 2.670 billion yuan, 3.041 billion yuan, and 3.624 billion yuan for the years 2024, 2025, and 2026 respectively [10]. - The target price is set at 8.64 yuan, based on a price-to-earnings ratio of 12 times for 2024 [10].