ZhongWang Fabric (605003) 天风证券·2025-01-17 06:36Investment Rating - The report maintains a "Buy" rating for the company, with a 6-month target price of 17.57 RMB [7] Core Views - The company's overseas production capacity is accelerating, with the Vietnam factory expected to contribute significantly to growth by 2025 [4] - The company has been selected for the 2024 Zhejiang Province "Future Factory" list, indicating significant progress in digital intelligent manufacturing [2] - The company is expanding its global presence with new subsidiaries in Hong Kong and Singapore, aiming to enhance international competitiveness and service capabilities [3] Financial Performance - The company expects a net profit attributable to the parent company of 78-88 million RMB in 2024, a decrease of 71.97%-75.15% YoY, primarily due to the absence of one-time income from the demolition compensation of the Chongxian factory in the previous year [1] - The company's revenue is projected to grow from 536.45 million RMB in 2024E to 739.38 million RMB in 2026E, with a CAGR of 17.3% [6] - The EPS is forecasted to be 0.8, 1.0, and 1.2 RMB for 2024, 2025, and 2026, respectively [5] Operational Highlights - The Vietnam factory, with an annual production capacity of 8 million meters of high-end functional fabrics, began operations in August 2024 and is already fulfilling orders [4] - The company is actively developing markets in Australia, the Middle East, South Africa, and Europe, while also focusing on domestic sales [3] Valuation Metrics - The company's P/E ratio is expected to be 23X, 18X, and 15X for 2024, 2025, and 2026, respectively [5] - The EV/EBITDA ratio is projected to decrease from 9.65X in 2024E to 5.81X in 2026E, indicating improving valuation metrics [6] Industry Context - The company operates in the textile and apparel industry, specifically in the home textile sector, with its products primarily sold in the US market [5]