MEIHUA BIO、MeiHua Group(600873) CAITONG SECURITIES·2024-10-23 08:03Investment Rating - The investment rating for the company is "Accumulate" (maintained) [1] Core Views - The company's profitability in amino acids is growing, while the price of monosodium glutamate continues to face pressure [1][3] - The company reported a revenue of 18.681 billion yuan for Q3 2024, a year-on-year decrease of 8.99%, and a net profit of 1.995 billion yuan, down 7.65% year-on-year [2] - The amino acid business showed a price improvement in Q3, with the revenue from the animal nutrition amino acid segment reaching approximately 2.877 billion yuan, up 5.89% quarter-on-quarter [2] - The price of monosodium glutamate is under pressure due to increased supply and intensified competition in the industry [2] Summary by Sections Financial Performance - For Q3 2024, the company achieved a revenue of 60.38 billion yuan, down 12.97% year-on-year and 1.92% quarter-on-quarter, with a net profit of 5.22 billion yuan, down 33.96% year-on-year and 27.78% quarter-on-quarter [2] - The company expects revenues of 26.073 billion yuan, 29.034 billion yuan, and 32.206 billion yuan for 2024, 2025, and 2026 respectively, with corresponding net profits of 2.801 billion yuan, 3.240 billion yuan, and 3.395 billion yuan [3][4] Business Segments - The amino acid segment's revenue in Q3 was approximately 28.77 billion yuan, with significant price improvements for certain products [2] - The company plans to build a 600,000-ton/year lysine project to strengthen its leading position in the lysine market [2] - The monosodium glutamate segment reported a revenue of about 16.85 billion yuan in Q3, reflecting a decline due to increased competition and supply [2] Future Outlook - The company is expected to benefit from policies promoting reduced soybean meal usage, which may lead to simultaneous increases in both volume and price for amino acids [3] - The projected earnings per share (EPS) for 2024, 2025, and 2026 are 0.98 yuan, 1.14 yuan, and 1.19 yuan respectively, with corresponding price-to-earnings (PE) ratios of 10.07, 8.71, and 8.31 [3][4]