Asia-Potash(SZ:000893) Shenwan Hongyuan Securities·2025-05-21 07:44Investment Rating - The report maintains an "Outperform" rating for the company [1]. Core Views - The company reported better-than-expected performance, with record sales and production of potash fertilizers, indicating a recovery from the bottom of the market cycle [1][6]. - The company achieved a total revenue of 3.548 billion yuan in 2024, a year-on-year decrease of 9%, while the net profit attributable to shareholders was 950 million yuan, down 23.1% year-on-year [6][7]. - The first quarter of 2025 saw a significant increase in revenue to 1.213 billion yuan, up 91.5% year-on-year, and net profit of 384 million yuan, up 373.5% year-on-year [6][7]. Financial Summary - The company expects total revenue to reach 6.55 billion yuan in 2025, with a year-on-year growth rate of 84.6% [5]. - The projected net profit for 2025 is 1.887 billion yuan, representing a 98.5% increase compared to the previous year [5]. - The gross profit margin is expected to improve from 54.1% in Q1 2025 to 54.7% for the full year [5]. Market Dynamics - The potash fertilizer market is showing signs of recovery, with global supply and demand gradually returning to normal levels, supported by favorable tax policies in Laos [6]. - The average market price for potash fertilizer in 2024 was approximately 2,468 yuan per ton, down 15.6% year-on-year, but showing signs of stabilization in Q4 [6]. - The company’s production and sales volumes for 2024 were 1.8154 million tons and 1.7414 million tons, respectively, both showing year-on-year increases [6]. Shareholder and Project Developments - The company has strengthened its long-term development through significant shareholder support, with Huineng Group becoming the largest shareholder [6]. - The company is progressing well with its mining projects, aiming for a production capacity of 5 million tons per year, with potential expansion to 7-10 million tons based on market demand [6]. Profit Forecasts - The profit forecasts for 2025 and 2026 have been raised to 1.887 billion yuan and 3.114 billion yuan, respectively, with a new forecast for 2027 at 4.359 billion yuan [6]. - The corresponding price-to-earnings ratios are projected to be 14X for 2025, 8X for 2026, and 6X for 2027 [6].