HUALU-HENGSHENG(SH:600426) Dongxing Securities·2024-08-29 03:03Investment Rating - The report maintains a "Strong Buy" rating for the company [1][2]. Core Views - The company achieved a revenue of 16.975 billion yuan in the first half of 2024, representing a year-on-year increase of 37.35%, and a net profit of 2.224 billion yuan, up 30.10% year-on-year [1]. - The performance growth is driven by the operational efficiency of the Jingzhou base and technical upgrades at the Dezhou headquarters, leading to increased production and sales of key products [1]. - The company is advancing its dual-base project strategy, which is expected to support long-term growth through enhanced resource utilization and product innovation [1][2]. Summary by Sections Financial Performance - In the first half of 2024, the company's main products saw significant sales growth: - New energy materials sales increased by 28.47%, with revenue up 18.64% - Fertilizer product sales rose by 43.50%, with revenue increasing by 39.88% - Organic amines sales grew by 14.77%, but revenue slightly declined by 4.97% - Acetic acid and derivatives sales surged by 148.03%, with revenue up 145.66% [1]. - The overall gross margin improved by 0.34 percentage points to 21.20%, contributing to net profit growth [1]. Strategic Development - The company leverages clean coal gasification technology and a flexible multi-product production model to enhance resource utilization and expand its product chain [1]. - The Jingzhou base's first phase has commenced operations, generating revenue of 3.765 billion yuan and a net profit of 543 million yuan in the first half of 2024 [1]. - Future projects at both the Jingzhou and Dezhou bases are expected to contribute additional revenue, supporting the company's long-term growth strategy [1][2]. Profit Forecast - The company forecasts net profits of 4.680 billion yuan, 5.658 billion yuan, and 6.736 billion yuan for 2024, 2025, and 2026, respectively, with corresponding EPS of 2.20, 2.66, and 3.17 yuan [2]. - The current stock price corresponds to P/E ratios of 10, 8, and 7 for the years 2024 to 2026 [2].