三祥新材（603663）：核级锆项目投产，固态电池未来可期

Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [2]. Core Insights - The company is expected to achieve a historic breakthrough in high-end products in 2025, potentially marking a year of renewed growth. It is recognized as a national high-tech enterprise and a "little giant" enterprise by the Ministry of Industry and Information Technology, with main business segments including zirconium, magnesium, and advanced ceramics [5][20]. - In 2024, the company reported revenues and net profits of 1.054 billion and 76 million yuan respectively, showing a year-on-year decline of 2.41% and 4.38% due to intense industry competition and demand shocks in traditional sectors. However, growth in high-end applications like sponge zircon and advanced friction materials has mitigated some impacts [5][27]. - The company aims to achieve net profits of 1.5 billion, 2.2 billion, and 3.0 billion yuan from 2025 to 2027, supported by the ramp-up of its nuclear-grade zircon project and the delivery of solid-state battery materials [5][10]. Company Overview - The latest closing price of the company's stock is 23.28 yuan, with a total market capitalization of 9.9 billion yuan. The company has a total share capital of 424 million shares, with a debt-to-asset ratio of 33.1% and a price-to-earnings ratio of 129.33 [4]. - The company has a significant shareholder, Japan's Eisho Trading Co., Ltd., which holds a substantial stake [4]. Financial Projections - The company is projected to benefit from increased orders for nuclear-grade sponge zircon in 2025, with net profits expected to grow significantly in the following years. The estimated earnings per share (EPS) for 2025, 2026, and 2027 are 0.34, 0.58, and 0.75 yuan respectively, with corresponding price-to-earnings ratios of 71.81, 42.04, and 32.69 [10][12]. - Revenue is expected to reach 1.172 billion, 1.571 billion, and 1.873 billion yuan from 2025 to 2027, reflecting growth rates of 11.21%, 34.08%, and 19.20% respectively [12]. Business Segments - The company has established a comprehensive product matrix in the zirconium sector, including sponge zircon, zirconium oxychloride, and zirconium-based amorphous alloys, with ongoing efforts to expand into high-end applications [20][34]. - The nuclear-grade sponge zircon project is anticipated to start production in 2025, with a projected capacity of 1,300 tons, contributing to the company's growth trajectory [7][10]. - The solid-state battery sector is also a focus, with expectations for small-scale production by 2027 and large-scale commercialization by 2030, leveraging zircon-based materials for electrolyte applications [8][10].