JINHONG GAS(SH:688106) Ping An Securities·2024-10-30 04:11Investment Rating - The investment rating for the company is "Recommended" [10][18]. Core Views - The company's core products, including ultra-pure ammonia and high-purity nitrous oxide, have technical and scale advantages, with several high-end products being introduced to semiconductor clients, which is expected to gradually achieve bulk sales [10]. - The on-site gas production projects and electronic bulk gas orders are anticipated to contribute to steady annual growth in overall performance, despite intense industry competition and market changes leading to price declines for bulk and specialty gas products [10]. - The earnings forecast for 2024-2026 has been adjusted downwards, with expected net profits of 3.07 billion, 4.02 billion, and 5.12 billion respectively, reflecting a decrease from previous expectations [10]. Financial Performance Summary - In Q3 2024, the company achieved revenue of 626 million, a year-over-year decrease of 3.14%, and a net profit of 50 million, down 48.06% year-over-year [5]. - For the first three quarters of 2024, total revenue was 1.858 billion, an increase of 4.37% year-over-year, while net profit was 210 million, down 18.72% year-over-year [5]. - The overall gross margin for the first three quarters of 2024 was 33.09%, a decline of 5.34 percentage points compared to the same period in 2023 [5]. Business Segment Performance - Specialty gas sales increased year-over-year, but core product price reductions led to a decline in profitability [7]. - The on-site gas production projects have become a major source of revenue growth, contributing 210 million in revenue for Q1-Q3 2024, accounting for 11.32% of total revenue [7]. - The specialty gas business generated 773 million in revenue, a year-over-year decrease of 13.96%, while bulk gas revenue was 716 million, remaining stable year-over-year [8]. Future Outlook - The company is expected to see gradual performance improvements as new products are supplied in bulk and on-site gas projects are operational [10]. - The competitive landscape in the photovoltaic supply chain and semiconductor sectors is anticipated to improve, limiting the downward price pressure on gas products [10].