NBYS(600366) 浙商证券·2024-12-29 12:23Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [31][53]. Core Insights - The supply-demand dynamics for rare earths are improving, which is beneficial for the profitability of magnetic material companies [28][50]. - The company has established a core technology system and is deeply engaged with leading manufacturers in various downstream sectors, indicating a strong competitive position [28][30]. - The company is expected to experience a significant recovery in profits due to stable supply-side indicators and a favorable demand environment, particularly in the context of global monetary easing [28][30][81]. Supply Side Summary - The supply growth rate for rare earths is showing signs of a turning point, with China's mining indicators set at 190,000 tons for 2024, remaining stable for six consecutive years [2][5]. - The first batch of mining indicators for this year increased by 6% year-on-year, while the smelting indicators rose by 4% [5][83]. - The report notes that overseas supply, particularly from Myanmar, is facing challenges, and significant increases in production from other mines are unlikely before 2027 [6][11]. Demand Side Summary - The demand for rare earths is expected to remain resilient, particularly in the context of the global economic environment, which is conducive to price recovery [28][82]. - The report highlights the growing demand for neodymium-iron-boron materials driven by the electric vehicle sector, with projections indicating substantial increases in production requirements [21][22]. Company Performance and Forecast - The company is projected to achieve net profits of 0.97 billion, 2.77 billion, and 4.13 billion yuan for the years 2024, 2025, and 2026, respectively, reflecting growth rates of 143%, 184%, and 49% [31][56]. - The expected earnings per share (EPS) for the same years are 0.09, 0.25, and 0.38 yuan, with corresponding price-to-earnings (P/E) ratios of approximately 84.5, 29.7, and 20.0 [31][56]. Competitive Advantages - The company possesses leading production capacity in the industry, with a current capacity of 21,000 tons and plans for an additional 15,000 tons by 2025-2026 [51][36]. - The company has successfully penetrated the humanoid robot market, achieving mass production supply status for a domestic client in the third quarter of 2024, indicating diversification and growth potential [30][36].