CNRE(600111) 光大证券·2025-01-23 12:58Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected investment return exceeding the market benchmark by more than 15% over the next 6-12 months [6][15]. Core Views - The company is projected to achieve a net profit attributable to shareholders of 9.5 billion to 10.8 billion yuan in 2024, representing a year-on-year decrease of 54.41% to 59.90% [1]. - The fourth quarter net profit attributable to shareholders is expected to be the highest of the year, ranging from 5.45 billion to 6.75 billion yuan [2]. - The report highlights that the prices of rare earth products, particularly praseodymium and neodymium, have shown a downward trend, impacting overall profitability [2][4]. - The company is investing up to 7.8 billion yuan in a green smelting upgrade project, which is expected to enhance cost control and raw material processing capabilities [3]. - Future demand for rare earth materials is anticipated to grow, driven by new applications such as robotics and flying cars, with projected global demand for praseodymium and neodymium oxide expected to increase by 9.7% and 8.4% in 2025 and 2026, respectively [3]. Summary by Sections Financial Performance - The company expects a significant decline in net profit for 2024, with a forecasted EPS of 0.28 yuan, down 62.2% from the previous year [4]. - Revenue for 2024 is projected at 31.7 billion yuan, a decrease of 5.37% compared to 2023 [5]. - The company anticipates an increase in production across major product lines, including a 20.78% rise in rare earth metal production [2]. Price Trends and Market Outlook - The average price of praseodymium and neodymium oxide is expected to fluctuate, with the highest price recorded in Q4 2024 at 416,000 yuan per ton [2]. - The report notes that the rare earth market is currently weak, but a potential industry turnaround is anticipated as demand begins to recover [3]. Investment and Growth Strategy - The company is focused on enhancing its production capabilities through a significant investment in green technology, which is expected to improve operational efficiency [3]. - The anticipated improvements in supply-demand dynamics in the rare earth sector are expected to support the company's long-term growth [4].