Investment Rating - The report assigns a "Buy" rating for Nine Dragons Paper (2689.HK) based on its strong revenue growth and improving profitability outlook [18]. Core Views - The company is expected to achieve a revenue of 29.134 billion yuan in FY2024H2 (January to June 2024), representing a year-on-year increase of 13.8%. The net profit attributable to shareholders is projected to be 4.58 billion yuan, a significant year-on-year increase of 146.1% [18]. - The report highlights that the company's sales volume increased by 1.6 million tons year-on-year to 9.6 million tons, with a net profit per ton of 45 yuan, reflecting a quarter-on-quarter increase of 10 yuan per ton [18]. - The report anticipates a gradual recovery in demand driven by seasonal factors and downstream inventory replenishment, with expected monthly sales growth in Q4 2024 [18]. Summary by Sections Financial Performance - The total revenue for 2023 was 56.739 billion yuan, with a projected growth rate of -12% year-on-year. For 2024, the revenue is expected to increase to 59.496 billion yuan, reflecting a growth rate of 5% [20]. - The net profit attributable to shareholders for 2023 was -2.383 billion yuan, with a forecasted recovery to 751 million yuan in 2024, representing a year-on-year growth of 131% [20]. - The report projects earnings per share (EPS) to improve from -0.51 yuan in 2023 to 0.16 yuan in 2024, with a price-to-earnings (P/E) ratio of 19.09 [20]. Market Dynamics - The report notes that the demand for boxboard and corrugated paper is closely correlated with macroeconomic indicators such as retail sales and GDP growth, with expectations for economic recovery in 2025 to boost demand [18]. - Supply-side dynamics indicate that leading companies are expected to add over 2 million tons of new capacity in 2024, which may alleviate supply pressure [18]. - The report emphasizes the importance of product structure optimization and the acceleration of integrated pulp and paper layout, with total pulp and paper capacity expected to reach 25.37 million tons by mid-2025 [18].
玖龙纸业：量价齐升、盈利筑底，浆纸一体化布局加速