ZJJH(600160) Xiangcai Securities·2024-10-18 03:42Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [4]. Core Views - The company is a leading player in the fluorochemical industry, benefiting from a complete industrial chain and a favorable market environment for refrigerants [14][17]. - The supply of refrigerants is expected to remain tight due to policy constraints, which will enhance profitability for the company [26][27]. - The company is well-positioned to capitalize on the high profitability of refrigerants, particularly as it holds a significant share of production quotas for both second and third-generation refrigerants [5][20]. Summary by Sections Company Overview - The company is a domestic leader in fluorochemical production, with a highly integrated operational model that includes chlor-alkali, sulfuric acid, coal chemical, and basic fluorochemical industries [14][16]. - It has established a complete fluorochemical industrial chain, including basic raw materials, fluorinated refrigerants, organic fluorine monomers, fluorinated polymers, and fine chemicals [14][16]. Refrigerants - The supply side of fluorinated refrigerants is constrained by policies, which is expected to maintain a tight market [26]. - The production quotas for second-generation refrigerants, particularly R22, are being reduced significantly, which is anticipated to enhance profitability [20][27]. - The third-generation refrigerants are expected to see improved profitability in 2024 due to policy enforcement and strong demand from the air conditioning sector [20][26]. Fluoropolymers - The company has a diverse range of fluoropolymer materials, with a focus on high-end applications [5][19]. - It is investing in high-performance fluoropolymer research and development, including projects aimed at the semiconductor industry [5][19]. Financial Forecast - The company is projected to achieve net profits of 2.345 billion, 3.386 billion, and 4.333 billion yuan for the years 2024, 2025, and 2026, respectively [6]. - Revenue is expected to grow from 20.655 billion yuan in 2023 to 32.556 billion yuan in 2026, reflecting a compound annual growth rate [6]. Investment Recommendation - The company is positioned to benefit from the high profitability of refrigerants and the growth of its fluoropolymer business, with a favorable outlook for the next few years [5][20].