HUALU-HENGSHENG(SH:600426) Great Wall Securities·2025-09-09 08:22Investment Rating - The report maintains a "Buy" rating for the company, expecting the stock price to outperform the industry index by more than 15% in the next six months [4][18]. Core Views - The company's performance is under short-term pressure, but there is optimism regarding its upstream and downstream industry chain layout [1]. - The decline in overall performance is primarily attributed to falling product prices, despite an increase in production volume for certain products [2][3]. - The company is focusing on enhancing its integrated industrial chain, with ongoing projects expected to improve its competitive edge [9][10]. Financial Summary - Revenue projections for the company are as follows: 2025 at 344.23 billion, 2026 at 385.71 billion, and 2027 at 398.80 billion, with growth rates of 0.6%, 12.1%, and 3.4% respectively [10]. - The net profit for 2025 is projected at 38.53 billion, with a slight decline of 1.3%, followed by a recovery with growth rates of 14.9% and 18.3% in 2026 and 2027 respectively [10]. - The company's earnings per share (EPS) are expected to be 1.81, 2.09, and 2.47 for 2025, 2026, and 2027 respectively [10]. Product and Price Analysis - The company's main products, including urea, adipic acid, and acetic acid, have seen significant price declines year-on-year, impacting overall revenue [2][3]. - The average prices for key products in the first half of 2025 were reported as follows: urea at 1755 yuan/ton, adipic acid at 6850 yuan/ton, and acetic acid at 2375 yuan/ton, with year-on-year decreases of 17.02%, 18.45%, and 15.48% respectively [3]. Cash Flow and Financial Ratios - The company's operating cash flow for the first half of 2025 was 23.32 billion, a decrease of 19.84% year-on-year [3]. - The report highlights a significant increase in research and development expenses, which rose by 38.35% in the first half of 2025, indicating a focus on innovation [3]. - The company's liquidity ratios are projected to improve, with a current ratio expected to rise to 2.3 by 2027 [11].