CNCEC(SH:601117) EBSCN·2026-03-28 14:28Investment Rating - The report maintains a "Buy" rating for China Chemical (601117.SH) with a current price of 9.10 CNY [1]. Core Insights - In 2025, China Chemical achieved operating revenue of 189.5 billion CNY, a year-on-year increase of 2.0%, and a net profit attributable to shareholders of 6.44 billion CNY, up 13.2% [4][5]. - The company’s business segments, including engineering, industrial new materials, and modern services, showed stable performance, with significant growth in overseas revenue [5]. - The company continues to implement its "One Body, Two Wings" strategy, expanding into traditional markets and new sectors such as photovoltaics and energy storage [5]. Summary by Sections Revenue Performance - In Q4 2025, the company reported operating revenue of 53.66 billion CNY, with a year-on-year growth of 3.8% [4]. - The company’s total revenue for 2025 was broken down into segments: engineering (178.1 billion CNY), industrial new materials (9.8 billion CNY), and modern services (2.2 billion CNY) [5]. Profitability - The gross margin for 2025 was 10.7%, an increase of 0.60 percentage points year-on-year, while the net margin was 3.7%, up 0.38 percentage points [6]. - The company effectively controlled its expense ratios, with slight increases in sales and management expenses [6]. New Contracts - In 2025, the company signed new contracts worth 403.66 billion CNY, a 10.0% increase year-on-year, with significant growth in industrial new materials and chemical engineering orders [7]. - The company’s new contracts in January and February 2026 continued to show high growth, with a 19.3% increase compared to the previous year [7]. Profit Forecast and Valuation - The report adjusts the profit forecast for 2026 and 2027 to 6.93 billion CNY and 7.34 billion CNY, respectively, and introduces a new forecast for 2028 at 7.70 billion CNY [7]. - The company’s earnings per share (EPS) is projected to be 1.05 CNY in 2025, with a price-to-earnings (P/E) ratio of 9 [9][12].