CAPCHEM(SZ:300037)2024-10-31 00:34Investment Rating - The report maintains an "OUTPERFORM" rating for Shenzhen Capchem Technology with a target price of RMB 41.44 per share, based on a 28x PE valuation for 2024 [1][10]. Core Insights - In Q3 2024, the company's recurring net profit increased by 3.61% year-over-year, while the operating revenue for the first three quarters reached RMB 5.667 billion, a 1.51% increase year-over-year [6][10]. - The company has seen a significant increase in shipments of battery chemicals despite fierce competition and declining prices in the lithium battery materials market [7]. - The Hydrafone project is progressing smoothly, with production capacity gradually increasing and expected to achieve profitability within two years of production commencement [8][10]. - The Poland plant has been operating steadily since 2023, with a production capacity of 40,000 tonnes, effectively meeting the demand from European and American customers [9]. Financial Summary - The company achieved operating revenue of RMB 2.085 billion in Q3 2024, a quarter-over-quarter increase of 0.85% but a year-over-year decrease of 3.02% [6]. - The net profit after deductions for Q3 2024 was RMB 275 million, reflecting a quarter-over-quarter increase of 11.38% and a year-over-year increase of 3.61% [6][10]. - Forecasted net profits for 2024, 2025, and 2026 are RMB 1.117 billion, RMB 1.444 billion, and RMB 1.846 billion, respectively [10].