ZHmag(SZ:300224) China Post Securities·2025-05-27 05:35Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [1]. Core Viewpoints - The company, Zhenghai Magnetic Materials, reported a revenue of 5.539 billion yuan in 2024, a year-on-year decrease of 5.70%, and a net profit attributable to shareholders of 92 million yuan, down 79.37% year-on-year [4][13]. - In Q1 2025, the company achieved a revenue of 1.459 billion yuan, representing a year-on-year increase of 24.38%, while the net profit attributable to shareholders was 69 million yuan, showing a decline of 10.94% [14]. - The company is focusing on its core business of magnetic materials, particularly in the high-performance neodymium-iron-boron permanent magnet sector, which is facing intense competition and price pressures [5][16]. Company Overview - The latest closing price of the company's stock is 12.59 yuan, with a total market capitalization of 10.5 billion yuan [3]. - The company has a total share capital of 838 million shares, with a debt-to-asset ratio of 54.5% and a price-to-earnings ratio of 114.45 [3]. Financial Performance - The company's revenue from neodymium-iron-boron permanent magnets in 2024 was 5.494 billion yuan, down 4.79% year-on-year, with a gross profit of 779 million yuan, a decrease of 24.60% [17]. - The gross margin for 2024 was 14.18%, down 3.73 percentage points from 2023 [17]. - The company expects revenues to grow to 6.382 billion yuan in 2025, with a projected net profit of 327 million yuan, reflecting a significant recovery [8][10]. Production and Market Development - The company has a production capacity of 30,000 tons for high-performance neodymium-iron-boron permanent magnets, with a utilization rate of 84% at its Yantai base and 62% at its Nantong base [6][18]. - The shipment volume for energy-saving and new energy vehicles increased by 25% in 2024, with a total of 5.61 million sets of electric motors equipped [19]. - The company is advancing the development of non-rare earth products, which have seen a 50% increase in production, enhancing its competitive edge in the market [7][19].