Wuzhou Special Paper(605007) 华创证券·2025-05-01 04:57Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 13.4 CNY per share [2][8]. Core Views - The company has shown a steady revenue growth of 17.4% year-on-year in 2024, with total revenue reaching 7.66 billion CNY. The net profit attributable to shareholders increased by 33.2% to 360 million CNY [2][4]. - In Q1 2025, the company reported a revenue of 1.99 billion CNY, reflecting a year-on-year growth of 15.2%, although the net profit decreased by 51.6% compared to the previous year [2][4]. - The company is expected to maintain a production capacity of approximately 2.3 million tons in 2025, with new production lines expected to enhance sales volume gradually [8]. Financial Performance Summary - 2024 Financials: Total revenue was 7.66 billion CNY, with a gross margin of 9.9%. The net profit margin was 4.7% [4][8]. - 2025 Projections: Expected revenue growth of 21.6% to 9.31 billion CNY, with net profit projected at 457 million CNY, reflecting a growth rate of 26.2% [4][9]. - Earnings Per Share (EPS): Projected EPS for 2025 is 0.96 CNY, with a price-to-earnings (P/E) ratio of 12 [4][9]. Production and Capacity Expansion - The company is expanding its production capacity, with plans to reach 2.8 million tons by the end of 2025. This includes new production lines in Hubei and Jiangxi provinces [8][9]. - The company has successfully launched new production lines, contributing to significant sales growth in specific product categories, particularly in industrial packaging and publishing paper [8][9]. Market Position and Competitive Landscape - As a leader in the specialty paper industry, the company is well-positioned to capitalize on market growth opportunities despite increasing competition and rising costs [8][9]. - The report highlights the company's ability to manage costs effectively, with a focus on maintaining profitability amid fluctuating raw material prices [8].