Investment Rating - The report initiates coverage with an "Outperform" rating for Sinofert Holdings, expecting a relative performance exceeding the market benchmark over the next 12-18 months [3][20]. Core Viewpoints - Sinofert Holdings is the largest comprehensive fertilizer enterprise in China, engaged in the integrated operation of production, supply, and marketing of fertilizer products. The company has been actively developing its "Bio+" strategy, which has led to the segmentation of its business into Basic Business, Growth Business, and Production [2][16]. - The company's recurring net profit for the first half of 2024 increased by 4.68% year-on-year, with total operating income showing a slight recovery after a decline in 2023 [3][17]. - The Growth Business segment has shown rapid growth, with revenue and profit increasing significantly due to the introduction of new products and a focus on bio-fertilizers and soil health [18][19]. Financial Performance - For the first half of 2024, the company reported total operating income of 21.776 billion yuan, with a year-on-year growth of 3.23%. The recurring net profit was 1.051 billion yuan, reflecting a 4.68% increase compared to the previous year [3][17]. - The gross sales margin for 2024H1 increased by 0.34 percentage points to 12.15% year-on-year [3][17]. - The forecast for net profit from 2024 to 2026 is projected to be 1.271 billion yuan, 1.450 billion yuan, and 1.592 billion yuan, respectively, with corresponding EPS of 0.18, 0.21, and 0.23 yuan per share [20]. Business Segmentation - The Basic Business segment focuses on sourcing and selling potash, phosphate fertilizers, and sulfur, while the Growth Business is dedicated to bio-compound fertilizers, specialty fertilizers, plant protection, and seeds [2][16]. - Revenue from the Growth Business for 2022, 2023, and the first half of 2024 was 7.441 billion yuan, 7.845 billion yuan, and 5.555 billion yuan, respectively, with a year-on-year growth of 5% [18][19]. Synergistic Effects - The company leverages its relationship with Syngenta Group to enhance product competitiveness, achieving significant revenue from plant protection and seed synergy projects [19][20].
中化化肥：首次覆盖：2024H1扣非后净利润同比增长4.68%，成长业务高速增长