JHSY(SZ:002597) ZHESHANG SECURITIES·2024-09-01 02:03Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Viewpoints - The company's Q2 performance met expectations, with a non-recurring net profit showing a quarter-on-quarter increase. The price of sucralose is expected to maintain a reasonable profit level in the long term, and the second phase of the Dingyuan project is beginning to contribute incremental performance [1][11] - The recent price increase of sucralose from 100,000 CNY/ton to 150,000 CNY/ton is seen as a significant step towards high-quality industry development, with expectations for sustainable profitability [1][11] - The report highlights that the current price increase differs from previous years due to improved industry concentration and collective production cuts among manufacturers, indicating a shift towards healthier competition [5][11] Summary by Relevant Sections Performance Overview - In H1 2024, the company's net profit attributable to shareholders was 247 million CNY, a year-on-year decrease of 38.74% and a quarter-on-quarter decrease of 17.88%. Q2 net profit was 118 million CNY, down 8.74% quarter-on-quarter, while the non-recurring net profit was 129 million CNY, up 6.42% quarter-on-quarter [1][11] Price Dynamics - The average market prices for key products in Q2 2024 were reported as follows: sucralose at 110,200 CNY/ton, acesulfame at 37,200 CNY/ton, and ethyl maltol at 72,400 CNY/ton, with changes of -11.84%, -2.11%, +50.83%, and +27.02% respectively [1][11] - The report anticipates that the price of sucralose may continue to rise due to production cuts and a current average industry cost of 114,000 CNY/ton, suggesting significant room for price increases [12][14] Industry Outlook - The report predicts that the industry will face a supply gap of approximately 3,000 tons in 2024, with an estimated production of 20,000 tons against a demand of 23,000 tons, supporting the sustainability of price increases [5][14] - The company is positioned as a rare asset with a strong growth trajectory in the sweetener market, with projected net profits for 2024-2026 of 1.03 billion CNY, 1.35 billion CNY, and 1.52 billion CNY respectively [6][18]