JIANGNAN CHEMICAL(SZ:002226) Changjiang Securities·2025-09-09 09:16Investment Rating - The investment rating for Jiangnan Chemical (002226.SZ) is "Buy" and is maintained [8]. Core Views - The company reported a revenue of 4.61 billion yuan for the first half of 2025, representing a year-on-year increase of 3.7%. The net profit attributable to shareholders was 430 million yuan, up 2.2% year-on-year [5][12]. - In Q2 alone, the company achieved a revenue of 2.6 billion yuan, which is a 5.4% increase year-on-year and a 29.2% increase quarter-on-quarter. The net profit for Q2 was 280 million yuan, reflecting a year-on-year increase of 2.8% and a significant quarter-on-quarter increase of 92.5% [5][12]. - The company has seen a substantial increase in new orders, with the annualized amount for new contracts in the blasting service segment reaching 6.24 billion yuan, indicating a significant improvement in order quality [12]. - The revenue from the civil explosive materials segment was stable at 1.33 billion yuan, although it saw a slight decline of 1.7% year-on-year [12]. - The company's revenue from the new energy business was 360 million yuan, down 7.7% year-on-year, attributed to increased market competition and changes in pricing mechanisms [12]. - The international market expansion is progressing steadily, with overseas revenue reaching 600 million yuan, a year-on-year increase of 20.2%, and the overseas revenue proportion rising from 11.2% in H1 2024 to 13.0% in H1 2025 [12]. - The company is positioned as a leading integrated service provider in the civil explosive sector under the China Ordnance Industry Group, with expectations for net profits of 1.0 billion, 1.59 billion, and 1.82 billion yuan for 2025 to 2027 [12]. Summary by Sections Financial Performance - For the first half of 2025, Jiangnan Chemical achieved a total revenue of 4.61 billion yuan, with a net profit of 430 million yuan, reflecting a year-on-year growth of 3.7% and 2.2% respectively [5][12]. - In Q2 2025, the company reported a revenue of 2.6 billion yuan, a 5.4% increase year-on-year and a 29.2% increase quarter-on-quarter [5][12]. Business Segments - The blasting service segment generated 2.55 billion yuan in revenue for the first half of 2025, marking a 7.3% year-on-year increase [12]. - The civil explosive materials segment's revenue was 1.33 billion yuan, showing a slight decline of 1.7% year-on-year [12]. - The new energy business reported a revenue of 360 million yuan, down 7.7% year-on-year, with a gross margin of 42.1% [12]. Market Expansion - The company is actively expanding its international market presence, with overseas revenue reaching 600 million yuan, a 20.2% increase year-on-year [12]. - The company plans to enhance its overseas project advantages with the anticipated injection of its subsidiary, Aoxin Chemical, which operates in 15 countries [12].