INNOVATION NEW MATERIAL TECHNOLOGY CO.(SH:600361) Hua Yuan Zheng Quan·2025-10-23 05:15Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage in the market [5][8]. Core Insights - The company is positioned as a leader in high-end aluminum alloy production, benefiting from growth in sectors such as ultra-high voltage, 3C electronics, and automotive lightweighting [5][7]. - Revenue is projected to grow from 72.84 billion RMB in 2023 to 82.22 billion RMB in 2025, with a compound annual growth rate of approximately 5.08% [6][57]. - The company aims to expand its international presence through a project in Saudi Arabia, which is expected to enhance its competitive edge globally [56][57]. Summary by Sections 1. High-End Aluminum Alloy Leader - The company has established a diverse product portfolio, including aluminum profiles for 3C electronics, automotive lightweighting, and aluminum rods and cables, which are widely used across various industries [7][20]. - The company has a stable shareholding structure, with the controlling shareholder holding 35.78% of the shares, ensuring strong backing from its parent company [18][20]. - Revenue has steadily increased from 594.3 billion RMB in 2021 to an expected 809.4 billion RMB in 2024, driven by robust downstream demand [22][57]. 2. Growth in High-End Aluminum Alloy Business - The aluminum rod and cable segment is expected to benefit from ongoing investments in ultra-high voltage projects, with a total investment of 380 billion RMB planned during the 14th Five-Year Plan [31][32]. - The 3C aluminum profile segment is experiencing accelerated demand due to the adoption of aluminum frames in the iPhone 17 series, which is expected to boost sales [40][41]. - The automotive lightweighting segment is also growing, with the company focusing on components such as crash beams and battery packs, entering partnerships with leading automotive brands [46][43]. 3. Raw Material Layout - The company is actively expanding its recycled aluminum operations, achieving a total recycling volume of 637,500 tons in the first half of 2025, a year-on-year increase of 12.37% [55][54]. - The Saudi project aims to establish a comprehensive aluminum industry chain, enhancing the company's international market reach and competitiveness [56][57]. 4. Profit Forecast and Valuation - The company is projected to achieve net profits of 7.5 billion RMB in 2025, 11.4 billion RMB in 2026, and 13.0 billion RMB in 2027, with corresponding P/E ratios of 21, 14, and 12 [6][57]. - The report compares the company with peers like Lichung Group and Yongmaotai, which have higher average P/E ratios, indicating potential for growth in the company's valuation [59].