Berun Chemical(SZ:000683) China Post Securities·2024-02-17 16:00Investment Rating - The report initiates coverage with an "Accumulate" rating for the company [5][8]. Core Views - The company is expected to achieve a net profit attributable to shareholders of 12.5-16.0 billion yuan in 2023, representing a decline of 39.84%-53.00% year-on-year. The non-recurring losses are primarily due to a provision for a lawsuit related to a subsidiary, impacting the net profit by 9.64 billion yuan [5]. - The price of soda ash remains strong, supported by high demand from the float glass industry, while industry inventory levels are low. As of February 9, 2024, inventory stood at 439,600 tons, significantly lower than 1,632,300 tons at the beginning of 2022 [5]. - The company is expanding its production capacity, with existing soda ash capacity of 1.8 million tons and new projects adding 5 million tons per year. The second phase of the project is planned to be completed by December 2025 with an investment of approximately 5.5 billion yuan [5]. Financial Summary - The company’s revenue is projected to be 11,118 million yuan in 2023, with a growth rate of 1.20%. By 2024 and 2025, revenue is expected to increase to 17,139 million yuan and 18,358 million yuan, respectively, reflecting growth rates of 54.16% and 7.11% [6][7]. - The net profit attributable to shareholders is forecasted to be 1,471.74 million yuan in 2023, with a significant decline of 44.67%. However, it is expected to rebound to 2,757.21 million yuan in 2024 and 3,139.28 million yuan in 2025, with growth rates of 87.34% and 13.86% [6][7]. - The company’s earnings per share (EPS) is projected to be 0.39 yuan in 2023, increasing to 0.74 yuan in 2024 and 0.84 yuan in 2025 [6][7].