BAOFENG ENERGY(600989) 太平洋·2025-03-17 12:23Investment Rating - The report maintains a "Buy" rating for Baofeng Energy (600989) [1] Core Views - The Inner Mongolia project is progressing smoothly, and the decline in raw material prices is contributing to profit enhancement [1][10] - The company achieved a revenue of 32,983 million yuan in 2024, representing a year-on-year growth of 13.21%, and a net profit attributable to shareholders of 6,338 million yuan, up 12.16% year-on-year [4][5] - The Inner Mongolia project is expected to significantly increase the company's production capacity, positioning it as the leader in China's coal-to-olefins industry with a total capacity of 5.2 million tons per year [4][5] Summary by Sections Financial Performance - In 2024, the company reported a revenue of 32,983 million yuan and a net profit of 6,338 million yuan, with respective growth rates of 13.21% and 12.16% [4] - The average profit for coal-based polyethylene in 2024 was 1,967 yuan per ton, an increase of 46.7% compared to 2023 [5] - The company forecasts revenues of 48,601 million yuan, 58,129 million yuan, and 60,075 million yuan for 2025, 2026, and 2027 respectively, with corresponding net profits of 11,042 million yuan, 13,619 million yuan, and 14,546 million yuan [7] Production Capacity and Projects - The Inner Mongolia project includes three production lines, each with a capacity of 1 million tons per year, with the first line already operational since November 2024 [4] - The company’s total olefin production capacity will reach 5.2 million tons per year following the completion of the Inner Mongolia project [4] Market Conditions - The report notes a decrease in coal prices, with procurement costs down by 12.96% year-on-year, which has improved the profitability of coal-to-olefins operations [5] - As of March 13, 2025, the average market prices for coking coal and thermal coal were 1,198 yuan per ton and 592 yuan per ton, respectively, reflecting year-on-year declines of 35.21% and 21.38% [5]