Muyuan Foods (SZ:002714) Huaxin Securities·2024-10-21 23:30Investment Rating - The report maintains a "Buy" investment rating for the company [3][11]. Core Views - The company has signed a special loan agreement with CITIC Bank for RMB 2.4 billion, aimed at facilitating stock repurchase, which will optimize its financing structure and reduce average financing costs [6][7]. - The stock repurchase plan is progressing steadily, reflecting the company's confidence in its long-term development and enhancing its governance structure [8]. - The company is expected to achieve a significant turnaround in profitability, with projected net profits for the first three quarters of 2024 estimated between RMB 10 billion and RMB 11 billion, indicating a substantial recovery compared to the same period in 2023 [9][10]. Summary by Sections Financing and Stock Repurchase - The company has secured a low-interest special loan at an annual rate of 2.25% to support its stock repurchase plan, which is expected to alleviate cash flow pressures and enhance operational focus [7]. - The planned stock repurchase will utilize RMB 3 billion to RMB 4 billion, with a maximum repurchase price of RMB 58.60 per share, aimed at employee stock ownership and incentive plans [8]. Performance and Growth - The company anticipates a significant increase in revenue, with projections of RMB 133.48 billion, RMB 152.01 billion, and RMB 155.19 billion for 2024, 2025, and 2026 respectively, reflecting growth rates of 20.4%, 13.9%, and 2.1% [11][13]. - The company has successfully reduced breeding costs, with the complete cost per kilogram dropping to RMB 13.7, and aims to further decrease it to RMB 13 by the end of 2024 [10][11]. Profitability Forecast - The earnings per share (EPS) are projected to be RMB 2.80, RMB 4.70, and RMB 3.62 for 2024, 2025, and 2026 respectively, with corresponding price-to-earnings (P/E) ratios of 15.4, 9.2, and 11.9 [11][13].