CCG(SH:605099) GOLDEN SUN SECURITIES·2024-09-23 00:08Investment Rating - The report initiates coverage with a "Buy" rating for the company [2][3]. Core Views - The company is a global leader in artificial turf, with a steady increase in market share and a robust global production capacity. The company has been in the industry for over a decade, achieving a market share of 18% by 2021. Revenue grew from 1.239 billion to 2.461 billion yuan from 2017 to 2023, with a CAGR of 12.1% [1][13]. - The demand for artificial turf is expected to grow due to its advantages such as year-round usage, long lifespan, and low maintenance costs. The global market size reached 21.2 billion yuan in 2021, with a CAGR of 10.3% from 2015 to 2021 [1][13]. - The company has a strong R&D capability, significantly higher than its peers, which has led to widespread recognition from global sports organizations. It has maintained the highest sales volume in the world for 11 consecutive years [1][13]. Summary by Sections 1. Company Overview - Established in 2004, the company focuses on R&D, production, and sales of artificial turf, serving major global sports organizations like FIFA [1][13]. - The company has expanded its production capacity significantly, with a current capacity of 110 million square meters, including 56 million in China and 54 million in Vietnam [1][13]. 2. Market Potential - The artificial turf market is projected to grow, with the sales volume of sports and leisure turf expected to increase at CAGRs of 5.6% and 10.5% respectively from 2021 to 2025 [1][13]. - The company is well-positioned to capture more market share due to its established brand and technological advantages [1][13]. 3. Financial Performance - The company's revenue is forecasted to reach 3.015 billion yuan in 2024, with a net profit of 541 million yuan, reflecting a growth rate of 22.5% year-on-year [6][2]. - The projected P/E ratios for 2024, 2025, and 2026 are 14.1X, 12.0X, and 10.3X respectively, indicating a favorable valuation trend [2][6]. 4. Competitive Advantages - The company invests heavily in R&D, with its R&D expenses significantly exceeding those of competitors, which enhances its product offerings and market position [1][13]. - The company has established a strong supply chain and production efficiency, particularly in its Vietnam facility, which has seen significant improvements in operational efficiency [1][13].