Investment Rating - The report upgrades the investment rating for the company to "Buy" with a target price of HKD 13.45, indicating a potential upside of 17.6% from the current price of HKD 11.44 [1][12]. Core Insights - The company's fourth-quarter performance demonstrates resilience, with a strong rebound in photovoltaic glass prices leading to the rating upgrade [2][7]. - The report highlights a significant increase in operating cash flow, which doubled year-on-year to RMB 5.91 billion in 2024, despite a projected decline in net profit for the same year [7][15]. - The report anticipates a strong rebound in photovoltaic glass prices due to a substantial reduction in supply and a recovery in demand, with expectations for continued price increases in the coming months [7][9]. Financial Overview - Revenue projections for the company show a decline from RMB 21,524 million in 2023 to RMB 18,683 million in 2024, followed by a slight recovery to RMB 18,695 million in 2025 [3][15]. - Net profit is expected to drop significantly to RMB 1,007 million in 2024, before recovering to RMB 1,054 million in 2025 [3][15]. - The company's gross margin is projected to decrease from 21.8% in 2023 to 15.5% in 2024, with a slight recovery expected in subsequent years [15][9]. Market Dynamics - The report notes that the average price of 2.0mm photovoltaic glass in mainland China fell by 13% in the fourth quarter, but the company's gross margin remained relatively stable due to effective cost control and a higher proportion of revenue from overseas production [7][9]. - The anticipated supply-side reforms and government policies aimed at addressing structural issues in the photovoltaic industry are expected to enhance market conditions [7][9]. - The report indicates that the company's production capacity will be limited in the near term, with only two new production lines expected to be commissioned in 2024, which may contribute to a tighter supply and support price increases [7][9].
福莱特玻璃：4季度业绩展现韧性，光伏玻璃价格近期强劲反弹，上调至买入-20250328