JIANGNAN CHEMICAL(SZ:002226) SINOLINK SECURITIES·2025-05-11 02:23Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [5][13]. Core Views - The company's explosive production capacity is expected to expand further, solidifying its industry-leading position and improving regional layout [4][5]. - The restructuring agreement with Hubei Chutian Chemical is anticipated to enhance the company's operational capabilities and market presence [3][4]. Summary by Sections Company Overview - The company, Jiangnan Chemical, along with its subsidiary, Northern Explosives, signed a restructuring agreement with Hubei Chutian Chemical to establish a new limited liability company, enhancing its control over the explosive production market [3]. Financial Performance - The company is projected to achieve revenues of 105.49 billion, 116.91 billion, and 128.64 billion RMB from 2025 to 2027, with corresponding net profits of 10.31 billion, 11.95 billion, and 13.80 billion RMB, reflecting year-on-year growth rates of 15.74%, 15.88%, and 15.48% respectively [5][10]. - The explosive production capacity is expected to reach nearly 800,000 tons per year after the completion of the restructuring, significantly enhancing the company's competitive edge [4]. Profitability Metrics - The report forecasts a diluted earnings per share (EPS) of 0.389, 0.451, and 0.521 RMB for 2025, 2026, and 2027, respectively, indicating a strong growth trajectory [10]. - The return on equity (ROE) is expected to improve from 10.02% in 2025 to 11.22% in 2027, showcasing the company's increasing profitability [10].