Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [2][3]. Core Viewpoints - The company, Fuheng New Materials, is recognized as a specialized "little giant" in modified plastics, focusing on R&D, production, and sales of various modified plastic products, which are widely used in home appliances, consumer electronics, and automotive parts [2][11]. - The demand for modified plastics is expected to grow due to the recovery in automotive production and the upgrade in consumer electronics, with the overall market size projected to reach 310.7 billion yuan in 2024 [2][37]. - The company has a strong technical foundation with over 10,000 modified plastic formulations, enabling it to meet diverse customer needs and enhance product performance [3][19]. Summary by Sections 1. Company Overview - Fuheng New Materials has been dedicated to the R&D and optimization of modified plastics since its establishment in 1993, achieving significant technical accumulation and product diversification [11][19]. - The company has seen continuous revenue growth, with a 50.44% year-on-year increase in Q1 2024, reaching 174 million yuan, and a net profit growth of 112.29% [2][21]. 2. Market Demand - The main downstream applications for modified plastics include home appliances, consumer electronics, and automotive parts, with significant growth expected in these sectors due to rising consumer demand and technological advancements [34][37]. - The modified plastics market in China has shown robust growth, with production increasing from 16.76 million tons in 2017 to 29.76 million tons in 2023, reflecting a compound annual growth rate of 10.04% [37][38]. 3. Competitive Advantages - The company has a deep technical foundation and a rich library of formulations, allowing it to offer customized solutions to meet specific customer requirements [3][19]. - Fuheng New Materials has established partnerships with well-known clients such as BYD and Mindray, enhancing its market presence and credibility [3][11]. 4. Financial Projections - The company is projected to achieve net profits of 77 million yuan, 103 million yuan, and 119 million yuan for the years 2024, 2025, and 2026, respectively, with corresponding dynamic P/E ratios of 11.84, 8.77, and 7.65 [2][3].
富恒新材：改性塑料专精特新“小巨人”，募投产能落地打开成长空间