PRCO(002225) China Post Securities·2025-05-15 06:44Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [2][5]. Core Insights - The company reported a revenue of 5.192 billion yuan in 2024, a year-on-year decrease of 5.13%, and a net profit attributable to shareholders of 135 million yuan, down 45.48% [5][13]. - The decline in performance is attributed to domestic demand weakness, intensified competition, and increased shipping costs due to complex international situations [5][13]. - The company has successfully expanded its overseas business, with foreign revenue reaching 1.455 billion yuan in 2024, accounting for 28% of total revenue, and a gross margin of 28.67%, significantly higher than the domestic margin of 15.21% [6][15][17]. - The active magnesium oxide market presents a new growth opportunity, with the company focusing on high-efficiency precipitation agents for cobalt and nickel extraction, having already established itself as a qualified supplier for several clients [7][20][21]. - The company is expected to achieve revenues of 5.774 billion yuan in 2025, with a year-on-year growth of 11.21%, and a net profit of 321 million yuan, reflecting a significant recovery [7][9]. Company Overview - The company is a leading player in the refractory materials industry, with a comprehensive supply chain from mining to product development and sales [12]. - As of the end of 2024, the company has a designed production capacity of 711,790 tons for refractory products and 470,000 tons for raw materials [12].