JHSY(002597) 浙商证券·2024-09-13 08:03Investment Rating - The report maintains a "Buy" rating for Jinhe Industrial (002597) with a target price of ￥22.69 [4] Core Views - The report highlights the potential for sustained price increases in the acesulfame potassium (A-K) market, driven by industry self-regulation and improved supply-demand dynamics [2] - The company is expected to benefit from price hikes in its key products, including A-K, sucralose, and methyl/ethyl maltol, with an estimated annual gross profit increase of 1.235 billion yuan [2][29] - The industry is transitioning towards high-quality development, with major players signaling a shift away from price wars and towards healthier competition [2][14] Supply and Demand Analysis - The A-K industry has seen moderate supply growth over the past two years, with no significant inventory accumulation, despite nominal overcapacity [2][14] - A-K exports increased by 32% year-over-year in the first seven months of 2024, driven by global demand for sugar-free products and inventory replenishment [14][17] - The report forecasts a tight supply-demand balance in 2025, with a supply-demand gap of 1,765 tons, supporting sustained price levels [22][23] Financial Projections - Revenue is expected to grow from 5.311 billion yuan in 2023 to 7.735 billion yuan in 2026, with a CAGR of 13.4% [3] - Net profit attributable to shareholders is projected to increase from 704 million yuan in 2023 to 1.520 billion yuan in 2026, with a CAGR of 29.2% [3] - The company's PE ratio is expected to decline from 18.37x in 2023 to 8.51x in 2026, reflecting strong earnings growth [3][4] Key Product Price Increases - A-K prices increased from 34,000 yuan/ton to 39,000 yuan/ton in September 2024, a 14.71% rise [14] - Sucralose prices rose by 10,000 yuan/ton, while methyl maltol and ethyl maltol prices increased by 4,000 yuan/ton and 2,300 yuan/ton, respectively [29] - These price hikes are expected to contribute significantly to the company's gross profit growth [29] Industry Trends - The A-K industry is moving towards self-regulation, with major players avoiding price wars and focusing on maintaining prices above cost levels [2][24] - The global demand for sugar-free products is driving growth in the artificial sweetener market, with A-K and sucralose gaining market share from older sweeteners like saccharin and cyclamate [17][18] - The report predicts that A-K exports will maintain an 8% growth rate, supported by ongoing trends in sugar reduction and inventory replenishment [18][22]