HLGF(SH:600346) Huaan Securities·2024-10-25 09:30Investment Rating - The investment rating for Hengli Petrochemical is "Buy" (maintained) [1] Core Views - The report highlights that fluctuations in raw material prices have pressured profitability, while new materials are flourishing [1] - The company achieved revenue of 177.76 billion yuan in Q3 2024, a year-on-year increase of 2.69%, but the net profit attributable to shareholders decreased by 10.45% to 5.105 billion yuan [1] - The report anticipates that the company's net profit for 2024, 2025, and 2026 will be 7.245 billion yuan, 11.191 billion yuan, and 11.466 billion yuan respectively, with corresponding PE ratios of 14.00X, 9.06X, and 8.85X [3] Summary by Sections Financial Performance - In Q3 2024, the gross margin was 7.78%, down 5.78 percentage points year-on-year and 4.83 percentage points quarter-on-quarter [1] - The net profit margin was 1.67%, a decrease of 2.50 percentage points year-on-year and 1.81 percentage points quarter-on-quarter [1] - The company reported a significant increase in sales volume for refining products and new materials, with year-on-year changes of +9.7% for refining products and +16.7% for new materials [1] Future Projections - The company is expected to fully launch its 1.6 million tons/year high-performance resin and new materials project in the second half of 2024, focusing on downstream extensions of the C2-C4 industrial chain [2] - The report projects revenue growth of 4.0% in 2024, 6.2% in 2025, and 0.6% in 2026 [4][7] Cost Management - The report indicates good control over expenses, with sales, management, and financial expense ratios for Q3 2024 at 0.22%, 0.67%, and 1.86% respectively [1] - R&D expense ratio increased to 0.69%, reflecting a growth in R&D investment [1] Market Conditions - The report notes that the price of crude oil has been under pressure due to weak economic data from the US and China, with WTI crude oil averaging $75.20 per barrel in Q3 2024, down 6.81% quarter-on-quarter [1] - The report emphasizes the need for domestic substitution in critical areas such as functional films and biodegradable materials [2]