Shandong Sinocera Functional Material (300285)2024-10-23 06:03Investment Rating - The investment rating for the company is "Outperform" with a target price of RMB 21.90, based on a 2024 PE of 30x [2][10]. Core Insights - In H1 2024, the company achieved a revenue of RMB 1.95 billion, representing a year-on-year growth of 5.57%, and a net profit attributable to shareholders of RMB 330 million, up 3.60% YoY [8][10]. - The company has six business sectors that are progressing well, including electronic materials, catalytic materials, biomedical materials, and precision ceramics, with notable growth in the catalytic materials sector [9][10]. - The company is focusing on domestic alternatives in the electronic materials sector and has successfully entered the supply chain of leading overseas commercial vehicle customers in the catalytic materials sector [9][10]. Financial Performance Summary - The company reported a revenue of RMB 3.859 billion in 2023, with projections of RMB 4.281 billion in 2024, RMB 4.889 billion in 2025, and RMB 5.666 billion in 2026, reflecting a year-on-year growth of 21.9% in 2023 and 10.9% in 2024 [3][6]. - The net profit for 2023 is projected at RMB 569 million, with forecasts of RMB 730 million in 2024, RMB 850 million in 2025, and RMB 997 million in 2026, indicating a net profit growth rate of 14.5% in 2023 and 28.3% in 2024 [3][6]. - The company’s gross margin is expected to improve from 38.7% in 2023 to 39.8% by 2026 [6][10]. Business Segment Analysis - The catalytic materials sector is projected to generate sales revenue of RMB 715.08 million in 2024, with a gross margin of 43% [4]. - The biomedical materials sector is expected to achieve sales revenue of RMB 854.68 million in 2024, with a gross margin of 59% [4]. - The electronic materials sector is forecasted to have sales revenue of RMB 598.49 million in 2024, with a gross margin of 36% [4].