wanhua(SH:600309) Huachuang Securities·2024-10-29 09:40Investment Rating - The report maintains a "Strong Buy" rating for the company, indicating an expectation to outperform the benchmark index by over 20% in the next six months [1][14]. Core Views - The company reported a revenue of 147.6 billion yuan for the first three quarters of 2024, a year-on-year increase of 11.35%, while the net profit attributable to shareholders decreased by 12.67% to 11.1 billion yuan [1]. - The increase in costs has pressured product margins, leading to a decline in gross margin in Q3 2024 [1]. - The company is undergoing a transformation in its ethane raw material usage, which is expected to enhance long-term profitability in the petrochemical sector [1]. Financial Performance Summary - For Q3 2024, the company achieved a revenue of 50.54 billion yuan, a year-on-year increase of 12.48%, but a net profit of 2.92 billion yuan, down 29.41% year-on-year [1][3]. - The gross margin for Q3 2024 was reported at 13.40%, down 4.0 percentage points year-on-year, primarily due to increased operating costs [1]. - The company plans to enhance its MDI production capacity, with expectations to increase total capacity to 4.8 million tons per year, which could boost its global market share to over 40% [1]. Future Outlook - The company has adjusted its net profit forecasts for 2024-2026 to 15.3 billion, 18.5 billion, and 22.8 billion yuan respectively, reflecting a cautious outlook on industry recovery [1][3]. - The target price for the company's stock is set at 88.2 yuan, based on a projected PE ratio of 15 times for 2025 [2][1].