YYTH(600096) 申万宏源·2024-09-09 04:05Investment Rating - The report maintains an "Accumulate" rating for the company [1][7]. Core Views - The company has a complete integration in phosphate chemicals, highlighting its high dividend attributes. It has become one of the largest phosphate mining and fertilizer production companies in China and is among the top ten phosphate fertilizer producers globally. The company benefits from high-quality phosphate resources in Yunnan and has a solid "mining and chemical integration" barrier, extending downstream into fine phosphate chemical businesses, leading to significant industry chain advantages and higher profit margins compared to peers [1][17][22]. - Phosphate ore supply may be lower than market expectations, with high demand expected to continue for at least three years. China contributes 41% of the world's phosphate production with only 5% of the reserves, and the demand for phosphate is projected to grow at a compound annual growth rate (CAGR) of 4%. Current supply shortages are keeping phosphate prices at historically high levels [1][9][30]. - Capacity control and cost support are expected to keep phosphate fertilizer prices high. Although global grain prices have declined since their peak in 2022, the ongoing economic growth and food security concerns are expected to support price levels. China's phosphate fertilizer production and demand have significantly declined since 2017, but are expected to stabilize in the future [1][4][30]. - The company’s POM (Polyoxymethylene) still has significant room for high-end substitution, and the synergy between phosphorus and fluorine resources is facilitating industrial transformation. The company leads in the development of fluorosilicic acid from phosphate by-products, which is crucial for entering the fluorochemical industry [1][5][22]. Summary by Sections 1. Phosphate Chemical Integration and High Dividend Attributes - The company has evolved from a nitrogen fertilizer base to a comprehensive phosphate chemical enterprise through various asset injections and acquisitions, establishing a strong market position [1][17]. - The actual controller of the company is the Yunnan State-owned Assets Supervision and Administration Commission, which holds a significant stake [21]. - The integration of mining and chemical operations has created cost advantages, with substantial phosphate reserves and production capabilities [22][23]. 2. Supply-side Logic of Phosphate Chemicals - The report discusses the tight supply of phosphate ore and the impact of environmental regulations on production capacity, suggesting that the supply-side logic will strengthen in the future [29][30]. 3. High Demand for Phosphate Ore - The report predicts that the high demand for phosphate ore will persist until at least 2027, driven by the increasing need for phosphate in various applications, including lithium iron phosphate for batteries [1][9]. 4. Phosphate Fertilizer Price Stability - The report anticipates that phosphate fertilizer prices will remain stable at high levels due to controlled production and ongoing demand [1][4]. 5. POM and Fluorine Resource Synergy - The company is positioned to benefit from the high-end substitution of POM and the development of fluorine resources, which are essential for its industrial transformation [1][5][22]. 6. Profit Forecast and Valuation - The company’s projected net profits for 2024-2026 are estimated at 52.25 billion, 55.59 billion, and 58.79 billion yuan, respectively, with a corresponding EPS of 2.85, 3.03, and 3.20 yuan per share [2][7].