EMT(SH:601208) HTSC·2024-08-22 08:03Investment Rating - The report maintains a "Buy" rating for the company with a target price of 8.74 RMB [5][6] Core Insights - In H1 2024, the company achieved a revenue of 2.12 billion RMB, representing a year-over-year increase of 16%, while the net profit attributable to the parent company was 160 million RMB, a decrease of 27% year-over-year [1] - The company plans to invest 700 million RMB to build a production line for 20,000 tons of high-speed communication substrate electronic materials, which is expected to enhance overall profitability [3] Revenue and Profitability - The company's Q2 2024 revenue reached 1.20 billion RMB, showing a year-over-year increase of 24% and a quarter-over-quarter increase of 31% [1] - The electronic materials segment saw a sales volume increase of 43% year-over-year to 29,000 tons, with revenue up 34% year-over-year to 540 million RMB [2] - The overall gross margin for H1 2024 decreased by 5.5 percentage points year-over-year to 14.6% [2] Financial Projections - The projected net profits for the company from 2024 to 2026 are 410 million RMB, 540 million RMB, and 650 million RMB, respectively, with corresponding EPS of 0.46 RMB, 0.60 RMB, and 0.73 RMB [1][4] - The average PE ratio for comparable companies in 2024 is expected to be 19 times, leading to a valuation of 19x PE for the company [1][4] Market Position and Strategy - The company is actively optimizing its optical film product structure, with significant growth in products like release films for polarizers and automotive functional films [2] - The company is facing pricing pressure in the basic epoxy resin market, with average prices down 7% year-over-year to 19,000 RMB per ton [2]