巨星农牧：牢铸成本优势，养殖业务扭亏为盈

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 22.14 CNY over the next six months [1][11]. Core Views - The company has successfully turned its pig farming business from loss to profit, while the leather business has negatively impacted overall profits. The reduction in costs and the increase in pig sales prices have contributed to this turnaround [4][5]. - The company is expected to see significant growth in revenue and profit over the next few years, with projected EPS of 1.41 CNY in 2024, 2.34 CNY in 2025, and 2.86 CNY in 2026 [3][5]. Summary by Sections Financial Performance - In H1 2024, the company achieved a revenue of 2.233 billion CNY, a year-on-year increase of 13.13%, and a net profit attributable to the parent company of -0.045 billion CNY, reducing losses by 87.13% [4]. - The company sold 1.0945 million pigs in H1 2024, with a significant increase in the sale of commercial pigs by 24.69% year-on-year [4]. Revenue and Profit Forecast - The company forecasts revenues of 6.073 billion CNY in 2024, 8.472 billion CNY in 2025, and 10.095 billion CNY in 2026, with growth rates of 50.28%, 39.52%, and 19.15% respectively [3][10]. - The net profit attributable to the parent company is expected to be 0.717 billion CNY in 2024, 1.196 billion CNY in 2025, and 1.458 billion CNY in 2026, reflecting growth rates of 211.09%, 66.80%, and 21.90% respectively [3][10]. Cost Management and Operational Efficiency - The company has implemented effective cost management strategies, achieving a PSY (Pigs per Sow per Year) of over 29 and reducing feed-to-meat ratios to below 2.6, which has significantly lowered production costs [5]. - The cost of raising commercial pigs was reported at 6.44 CNY per jin in June 2024 and 6.35 CNY per jin in July 2024, with total costs remaining below 7 CNY per jin [5]. Market Position and Competitive Advantage - The company is positioned to benefit from ongoing industry capacity reductions, which have led to rising pig prices, with prices increasing from 15 CNY per kg in April to 20 CNY per kg by August 2024 [4][5]. - The company has a robust breeding program with over 240,000 breeding pigs, ensuring sustained growth in production capacity [4].