SUN PAPER(SZ:002078)2024-10-30 06:41Investment Rating - The report maintains a "Recommended" rating for the company, with expected earnings per share (EPS) of 1.15, 1.31, and 1.49 for the years 2024, 2025, and 2026 respectively, corresponding to price-to-earnings (PE) ratios of 12X, 10X, and 9X [3]. Core Insights - The company reported a revenue of 30.975 billion yuan for Q3 2024, a year-on-year increase of 6.07%, and a net profit attributable to shareholders of 2.459 billion yuan, up 15.08% year-on-year [2]. - The report highlights the impact of rising raw material inventory costs on short-term profitability, with a gross margin of 16.35% for the reporting period, an increase of 0.9 percentage points year-on-year [2]. - The report notes a decline in raw material prices, with prices for needle pulp, broadleaf pulp, and chemical mechanical pulp at 6,225, 4,615, and 3,700 yuan per ton respectively, showing year-on-year changes of +1.53%, -15.11%, and -22.38% [2]. - The company is expanding its production capacity and enhancing its integrated operations in forestry, pulp, and paper, with several projects expected to commence trial production by 2025 [2][3]. Financial Summary - The company’s projected financial metrics include: - Revenue (in million yuan): 39,544.34 for 2023, 42,411.31 for 2024, 46,029.42 for 2025, and 51,677.23 for 2026, with growth rates of -0.56%, 7.25%, 8.53%, and 12.27% respectively [7]. - Net profit (in million yuan): 3,085.69 for 2023, 3,218.44 for 2024, 3,655.79 for 2025, and 4,170.55 for 2026, with profit growth rates of 9.86%, 4.30%, 13.59%, and 14.08% respectively [7]. - Gross margin is expected to slightly improve from 15.89% in 2023 to 16.15% in 2026 [7].