Zhejiang Longsheng(600352) 国海证券·2024-08-27 14:47Investment Rating - The report assigns a "Buy" rating for Zhejiang Longsheng (600352) based on its market position and performance outlook [1][6][14]. Core Views - The company has shown significant improvement in product sales, with a notable increase in market share despite ongoing competition in the dye industry [3][5]. - The controlling shareholder's continued share purchases reflect confidence in the company's long-term growth potential [6][14]. - The dye industry is currently at a low point but is expected to recover, with the company leveraging its leading position to expand market share [5][6]. Summary by Sections Financial Performance - In the first half of 2024, the company achieved operating revenue of 6.955 billion yuan, a decrease of 3.66% year-on-year, while net profit attributable to shareholders was 902 million yuan, an increase of 13.93% [3][4]. - For Q2 2024, the company reported operating revenue of 3.468 billion yuan, a slight decrease of 0.08% year-on-year, but net profit surged by 57.21% year-on-year to 705 million yuan [3][4]. - The sales gross margin improved to 28.72%, up by 2.85 percentage points year-on-year, indicating better cost management [3][4]. Product Sales and Market Position - The company experienced a 4.34% increase in dye sales volume year-on-year, further solidifying its market leadership [4][5]. - The average prices for disperse and reactive dyes have shown a slight decline, but the company has managed to offset this through increased sales volume [4][5]. - The sales volume of important intermediates like hydroquinone increased by 21.01% year-on-year, showcasing the company's strong position in both domestic and global markets [4][5]. Future Outlook - The company is projected to achieve operating revenues of 16.881 billion yuan, 15.775 billion yuan, and 19.890 billion yuan for 2024, 2025, and 2026 respectively, with net profits of 1.816 billion yuan, 1.828 billion yuan, and 2.225 billion yuan [6][14]. - The report anticipates a recovery in the dye industry, with the company expected to benefit from its scale and cost advantages [5][6].