DBN Group(SZ:002385) Tianfeng Securities·2024-08-23 12:00Investment Rating - The investment rating for the company is "Buy" with a target price indicating a potential return of over 20% within the next six months [4]. Core Views - The company has shown improvement in its performance in the first half of 2024, with a focus on the potential of its genetically modified (GM) business and the establishment of a nationwide seed promotion network [1][3]. - The company is expected to benefit from the recovery in the pig cycle in the second half of 2024, which is anticipated to drive growth in its pig farming segment [3][4]. Financial Data and Valuation - Revenue for 2023 is projected at 33,390.13 million yuan, with a growth rate of 3.07% compared to 2022. By 2026, revenue is expected to reach 54,328.29 million yuan, reflecting a growth rate of 13.02% [1][8]. - The company reported a net profit attributable to the parent company of -2,173.89 million yuan in 2023, with a significant recovery expected in the following years, reaching 1,265.60 million yuan by 2026 [1][8]. - The company's earnings per share (EPS) is forecasted to improve from -0.50 yuan in 2023 to 0.29 yuan in both 2025 and 2026 [1][3]. Business Segments - In the feed segment, the company experienced a slight decline in sales volume, down 8.92% year-on-year, but improved its gross margin to 12.67% in the first half of 2024 [2]. - The pig farming segment showed a 2.45% increase in sales volume, with profitability improving in the second quarter of 2024 [2]. - The seed segment saw a significant increase in sales volume, up 87.74% year-on-year, with a focus on GM corn varieties that have received safety certificates [3]. Profitability Forecast - The company is expected to achieve EPS of 0.03 yuan in 2024, increasing to 0.29 yuan in 2025 and 2026, driven by advancements in its GM technology and a favorable market environment for its seed and pig farming businesses [3][4].