Investment Rating - The report initiates coverage on the company with a "Buy" rating and sets a target price of 52.20 RMB, based on a PEG valuation of 2.00 times for 2026 [8]. Core Views - The company is positioned as a leader in high-temperature alloy recycling, with a unique high-return recycling process that increases the usage of recycled materials in products like GH4169 to 70%, reducing costs by approximately 30% compared to traditional methods [2][4]. - The company is expected to achieve a compound annual growth rate (CAGR) of 30.39% in revenue and 42.56% in net profit attributable to the parent company from 2020 to 2024, driven by strong demand in aerospace engine maintenance, commercial aerospace, and domestic gas turbine and nuclear power construction [1][2]. - Despite facing short-term pressure on performance in 2025 due to product structure adjustments and fluctuations in downstream demand, the company is anticipated to resume high growth starting in 2026 as high-margin military and commercial aerospace businesses ramp up [1][24]. Summary by Relevant Sections Company Overview - The company is one of the few in China to achieve industrial application of recycled high-temperature alloys for aerospace engines, addressing the challenge of resource recycling in high-temperature alloys [2][24]. - The company has a strong technical barrier and has received certifications from key clients such as China Aviation Engine Corporation and Aviation Industry Corporation of China, enabling mass supply [2][24]. Market Demand - The aerospace sector is experiencing robust demand due to military aircraft upgrades, the commercialization of domestic large aircraft, and rapid development in commercial aerospace [3]. - The gas turbine sector is accelerating domestic substitution, with the company's products already certified by multiple gas turbine manufacturers [3]. - The nuclear power sector is expected to see new growth points with the restart of third-generation nuclear power and demonstration projects for fourth-generation nuclear power [3]. Financial Projections and Valuation - The company is projected to achieve net profits of 0.93 billion RMB, 1.67 billion RMB, and 2.31 billion RMB for the years 2025 to 2027, respectively [6]. - The average PEG of comparable companies in the high-temperature alloy sector is 1.94, but the company is assigned a PEG of 2.00 due to its leadership position and scarcity in the market [6]. - The target price of 52.20 RMB corresponds to a CAGR of 58.12% in net profit attributable to the parent company for 2026-2027 [6]. Competitive Advantages - The company has a significant cost advantage due to its high-return recycling process, with a cost per ton of high-temperature alloy at 166,600 RMB, compared to 192,800 RMB and 240,400 RMB for competitors [4]. - The company is expected to benefit from the increasing penetration of recycled materials in the high-temperature alloy industry, which is currently low in China compared to international levels [3][4]. Growth Strategy - The company is not only a traditional supplier of high-temperature alloys but also provides high-performance, low-cost domestic alternatives through its core technology, targeting high-end equipment manufacturing [5][18]. - The company has made significant strides in expanding its overseas market presence, securing long-term supply agreements with leading international aerospace and petrochemical companies [19][20].
上大股份（301522）：看好高温合金循环再生龙头长期成长