CJS(SH:600176) Minsheng Securities·2024-08-23 10:11Investment Rating - The report maintains a "Recommended" rating for the company [5][6]. Core Views - The company reported a slight decline in revenue for the first half of 2024, with total revenue of 7.739 billion yuan, down 1.16% year-on-year, and a significant drop in net profit attributable to shareholders, which was 961 million yuan, down 53.41% year-on-year [2][5]. - In Q2 2024, the company experienced a revenue increase of 4.77% year-on-year, reaching 4.357 billion yuan, and a net profit of 611 million yuan, down 46.5% year-on-year, indicating a recovery in profitability compared to Q1 [2][3]. - The report highlights the positive effects of price increases in the industry, particularly in the direct yarn segment, where prices rebounded significantly due to supply adjustments and increased demand for inventory replenishment [3][4]. Summary by Sections Financial Performance - For H1 2024, the company achieved a revenue of 7.739 billion yuan, with a net profit of 961 million yuan, and a non-recurring net profit of 628 million yuan [2]. - Q2 2024 saw a gross margin of 22.57%, which is a decrease of 6.31 percentage points year-on-year but an increase of 2.43 percentage points quarter-on-quarter [2][3]. Product Segments - Direct Yarn: The average price for direct yarn in Q2 2024 was 3,666 yuan/ton, down 7.1% year-on-year but up 19.6% quarter-on-quarter. The sales volume for H1 2024 was 1.52 million tons, up 23% year-on-year [3]. - Electronic Fabric: The average price for electronic fabric in Q2 2024 was 3.71 yuan/meter, up 4.2% year-on-year and 9.9% quarter-on-quarter, indicating a stronger supply-demand balance compared to direct yarn [4][5]. Market Trends - The report anticipates continued price resilience in the direct yarn market, driven by strong pricing strategies from leading companies and a supportive cost structure [5]. - The demand outlook focuses on exports and wind power yarn, with significant growth in exports observed in the glass fiber industry [5]. Investment Recommendations - The report suggests maintaining a positive outlook on the company due to its leading position in the market, favorable pricing dynamics, and the potential for cost advantages from its zero-carbon initiatives [5][6]. - The profit forecasts for 2024-2026 are adjusted to 2.261 billion yuan, 3.028 billion yuan, and 3.427 billion yuan respectively, with corresponding dynamic PE ratios of 18x, 13x, and 12x [5][6].