BAOFENG ENERGY(SH:600989) Guohai Securities·2024-08-14 23:30Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company achieved significant revenue and profit growth in Q2 2024, with revenue of 8.67 billion yuan, up 36.39% year-on-year and 5.39% quarter-on-quarter. The net profit attributable to shareholders reached 1.884 billion yuan, a year-on-year increase of 75.80% and a quarter-on-quarter increase of 32.57% [3][5][8] - The company's return on equity (ROE) improved to 4.71%, an increase of 1.66 percentage points year-on-year and 1.09 percentage points quarter-on-quarter. The gross profit margin was 38.23%, up 10.39 percentage points year-on-year and 9.51 percentage points quarter-on-quarter [3][5][8] Summary by Sections Financial Performance - In the first half of 2024, the company reported total revenue of 16.897 billion yuan, a year-on-year increase of 29.09%, and a net profit of 3.305 billion yuan, up 46.44% year-on-year. The weighted average return on equity was 8.19%, an increase of 1.71 percentage points year-on-year [5][11] - The sales gross margin for the first half of 2024 was 33.60%, up 5.80 percentage points year-on-year, while the net profit margin was 19.56%, an increase of 2.32 percentage points year-on-year [5][11] Product Performance - The olefin segment saw significant profit growth, with the company benefiting from the commissioning of new projects and increased sales volumes. The polyethylene sales volume in Q2 2024 was 279,700 tons, up 78.61% year-on-year, while polypropylene sales volume reached 304,600 tons, up 114.51% year-on-year [8][9] - The average price of polyethylene in Q2 2024 was 8,529 yuan/ton, a year-on-year increase of 3.49%, while the average price of polypropylene was 7,866 yuan/ton, up 5.65% year-on-year [8][9] Project Development - The company is advancing multiple projects, including the Ningdong Phase III olefin project, which aims to enhance production capacity and efficiency. The project has been in trial production since September 2023 and is expected to contribute significantly to future revenue [9][10] - The company is also planning a coal-to-olefin project in Xinjiang, which is expected to leverage the region's abundant coal resources and enhance the company's growth potential [10][11] Earnings Forecast - The company is projected to achieve revenues of 36.2 billion yuan, 55.7 billion yuan, and 60.1 billion yuan for the years 2024, 2025, and 2026, respectively, with net profits of 8 billion yuan, 14.2 billion yuan, and 17.5 billion yuan for the same years [11][45]