KAILONG(SZ:002783) Tai Ping Yang·2025-04-30 07:10Investment Rating - The report assigns a "Buy" rating for the company, indicating an expected relative increase of over 15% compared to the CSI 300 index in the next six months [7][13]. Core Views - The company has become a regional leader in civil explosives, with the Hubei Provincial State-owned Assets Supervision and Administration Commission becoming the actual controller, presenting new development opportunities [2][10]. - The company reported a revenue of 1.441 billion yuan for 2024, a year-on-year decrease of 2.45%, and a net profit attributable to shareholders of 148 million yuan, down 15.51% [2][4]. - The company has actively pursued mergers and acquisitions to enhance its production capacity and market competitiveness, achieving a production capacity of 248,000 tons by the end of 2024, making it the largest civil explosive production enterprise in Hubei [3][6]. Summary by Sections Financial Performance - In Q4 2024, the company achieved a revenue of 1.12 billion yuan, a 4.9% increase, and a net profit of 36.18 million yuan, a significant increase of 539.88% [4]. - The explosive service business saw a remarkable revenue growth of 75.05%, contributing 27.72% to total revenue, primarily due to the acquisition of a 51% stake in Hubei Kailong Shiwang Engineering Co., Ltd. [4][6]. - The civil explosive products segment experienced a revenue decline of 17.98%, totaling 1.337 billion yuan, affected by macroeconomic fluctuations and cyclical demand in downstream infrastructure and mining sectors [4]. Future Outlook - The new actual controller is expected to lead the company into a new growth phase, leveraging both organic and external growth strategies [7][10]. - Revenue projections for 2025-2027 are estimated at 4.246 billion yuan, 4.697 billion yuan, and 5.202 billion yuan, respectively, with corresponding net profits of 240 million yuan, 278 million yuan, and 316 million yuan [9]. - The expected earnings per share (EPS) for 2025, 2026, and 2027 are projected to be 0.48 yuan, 0.56 yuan, and 0.63 yuan, respectively [9].