Huangma Technology(SH:603181) HTSC·2025-10-29 11:10Investment Rating - The investment rating for the company is maintained at "Buy" with a target price of RMB 18.80 [1][4]. Core Insights - The company reported a revenue of RMB 6.26 billion in Q3, representing a year-over-year increase of 2.04% and a quarter-over-quarter increase of 5.93%. The net profit attributable to shareholders was RMB 1.19 billion, showing a year-over-year growth of 25.15% [1]. - For the first three quarters of 2025, the company achieved a total revenue of RMB 18.20 billion, up 5.66% year-over-year, with a net profit of RMB 3.37 billion, reflecting an 18.15% increase year-over-year [1]. - The company has been optimizing its product structure and is expected to enhance profitability further with the commissioning of ongoing projects [1][4]. Summary by Sections Revenue and Profitability - In Q3, the company sold 5.2 million tons of surfactants, a 10% increase quarter-over-quarter, with an average selling price down by 5%. The strategic emerging sector saw a 17% increase in sales volume [3]. - The average price of key raw materials, propylene oxide and ethylene oxide, decreased by 16% and 2.7% respectively in H1 2025, contributing to a 1.3 percentage point increase in overall gross margin to 26.4% [2]. Future Projections - The company is projected to achieve net profits of RMB 4.8 billion, RMB 5.5 billion, and RMB 6.3 billion for the years 2025 to 2027, with respective growth rates of 22%, 14%, and 15% [4]. - The expected earnings per share (EPS) for 2025, 2026, and 2027 are RMB 0.82, RMB 0.94, and RMB 1.07 respectively [4]. Market Position - The company is actively advancing its high-end functional materials project, with an annual capacity of 330,000 tons, expected to begin trial production in the first half of 2026 [3].