Shandong Xiantan (SZ:002746) Guotou Securities·2024-02-21 16:00Investment Rating - The report assigns a "Buy - A" investment rating to the company, with a target price of 9.01 CNY over the next six months, based on a 9x PE for 2024 [3][4][37]. Core Insights - The company is positioned as a leading player in the domestic white feather chicken breeding industry, with excellent cost control and significant capacity expansion potential. The expected sales volume for chicken products from 2023 to 2025 is projected to be 585,500/655,800/734,500 tons, with year-on-year growth rates of 14.0%/12.0%/12.0% [3][37]. - The white feather chicken industry is anticipated to experience a turnaround in Q1 2024, which could benefit the company significantly [3][37]. - The company is expected to achieve revenues of 5.68 billion/6.88 billion/7.27 billion CNY for 2023-2025, with year-on-year growth rates of 11.3%/21.1%/5.7%, and net profits of 250 million/860 million/480 million CNY, reflecting year-on-year growth rates of 95.3%/243.6%/-44.4% [3][37]. Summary by Sections Sales and Production - The company’s chicken product sales revenue for January 2024 reached 454 million CNY, a year-on-year increase of 53.55%, with a sales volume of 48,900 tons, up 85.08% year-on-year [17]. - The company’s breeding project in Zhucheng is progressing well, with an expected annual output of 50 million chickens, and the total slaughter volume is projected to reach 250-270 million chickens upon full production [13][17]. Financial Projections - The company is projected to achieve total revenues of 5.68 billion CNY in 2023, 6.88 billion CNY in 2024, and 7.27 billion CNY in 2025, with corresponding year-on-year growth rates of 11.3%, 21.1%, and 5.7% [33][37]. - The average selling price for chicken products is expected to be 9.3/10.0/9.3 CNY per kilogram from 2023 to 2025, while the average cost is projected to decrease to 8.7/8.2/8.2 CNY per kilogram [20][21]. Market Conditions - The current market for chicken has seen a price increase of 12.3% since December 15, 2023, due to tightened supply and increased stocking by distributors [2][12]. - The report highlights that the overall recovery in the white feather chicken industry is expected to support the company's growth trajectory in the coming years [3][12].