EASTERN SHENGHONG(SZ:000301) Changjiang Securities·2025-05-05 08:12Investment Rating - The investment rating for the company is "Buy" and it is maintained [6]. Core Views - The company is expected to achieve operating revenue of 137.68 billion yuan in 2024, a year-on-year decrease of 1.97%. The net profit attributable to the parent company is projected to be -2.30 billion yuan, a year-on-year decline of 420.33%. The non-recurring net profit attributable to the parent company is expected to be -2.65 billion yuan, a year-on-year decrease of 1322.44% [4][10]. - In Q4 2024, the operating revenue is anticipated to be 29.37 billion yuan, a year-on-year decrease of 20.10% and a quarter-on-quarter decrease of 17.18%. The net profit attributable to the parent company is expected to be -878 million yuan, showing a reduction in losses year-on-year [4][10]. - For Q1 2025, the operating revenue is projected to be 30.31 billion yuan, a year-on-year decrease of 17.50% and a quarter-on-quarter decrease of 3.19%. The net profit attributable to the parent company is expected to be 341 million yuan, a year-on-year increase of 38.19% [4][10]. Financial Performance - The company has a significant share of its refining products, with 70% of its output coming from refined oil and aromatics, benefiting from the improvement in the market conditions for these products [10]. - The company has temporarily suspended the implementation of its biodegradable materials project, which is expected to reduce capital expenditures [10]. - The polyester chain is under pressure, but the company maintains a leading position in differentiated fiber production and has a strong capacity for recycled polyester fibers [10]. Future Outlook - The company is expected to see improvements in profitability, with projected net profits attributable to the parent company of 1.42 billion yuan, 2.55 billion yuan, and 3.38 billion yuan for 2025, 2026, and 2027 respectively [10]. - The price-to-earnings ratio (PE) for 2025, 2026, and 2027 is expected to be 41.0X, 22.8X, and 17.2X respectively, indicating a potential for growth [10].