Cofco Sugar(SH:600737) Zhongyuan Securities·2025-09-17 11:05Investment Rating - The report assigns an "Accumulate" rating to the company, indicating a potential increase of 5% to 15% relative to the CSI 300 index over the next six months [19] Core Views - The company's performance aligns with forecasts, with a narrowing decline in earnings for Q2 2025. For the first half of 2025, the company reported revenue of 11.767 billion yuan, a year-on-year decrease of 21.32%, and a net profit attributable to shareholders of 445 million yuan, down 48.42% year-on-year [5][6] - The industry is experiencing a downturn, with increased production year-on-year. The international sugar prices have shown significant volatility, while domestic sugar prices have remained relatively stable due to a slowdown in import supply [7] - The company's main business revenue has declined, but breakthroughs have been achieved in specific product categories. The sugar business revenue was 10.594 billion yuan, accounting for 90.03% of total revenue, with a year-on-year decrease of 22.12% [7][8] Financial Performance Summary - For Q2 2025, the company achieved revenue of 6.730 billion yuan, a year-on-year decline of 5.80%, and a net profit of 268 million yuan, down 36.54% year-on-year [5] - The gross margin for the first half of 2025 was 8.49%, a decrease of 1.93 percentage points year-on-year, while the net margin was 3.85%, down 2.01 percentage points year-on-year [10] - The company’s debt-to-asset ratio stood at 48.04% as of mid-2025, an increase of 6.56 percentage points compared to the end of 2024 [10] Future Earnings Projections - The company is expected to achieve net profits of 1.298 billion yuan, 1.892 billion yuan, and 2.029 billion yuan for the years 2025, 2026, and 2027 respectively, with corresponding EPS of 0.61 yuan, 0.88 yuan, and 0.95 yuan [10][11] - The current stock price corresponds to a PE ratio of 27.67 for 2025, 18.98 for 2026, and 17.70 for 2027, indicating that the company is within a reasonable valuation range [10][11]