STL(SZ:002648) Soochow Securities·2024-03-25 16:00Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company reported a revenue of 41.487 billion yuan in 2023, a year-on-year increase of 12%, and a net profit attributable to shareholders of 4.789 billion yuan, up 55% year-on-year [2][3] - The decline in ethane prices has led to a reduction in costs for the C2 segment, with the average price of ethane in the US dropping to approximately 182 USD/ton in 2023, down 173 USD/ton year-on-year [3] - The company completed the acquisition of Jiahong New Materials, adding significant production capacity, which is expected to contribute positively to earnings [3] - The company plans to invest 25.7 billion yuan in an alpha-olefin comprehensive utilization project, which is expected to enhance performance through capacity expansion [3] Financial Forecasts and Valuation - The company’s projected net profits for 2024 and 2025 are adjusted to 6.1 billion yuan and 6.7 billion yuan respectively, with a new estimate for 2026 at 9 billion yuan [4] - The price-to-earnings (P/E) ratios based on the closing price on March 26 are projected to be 9.3, 8.4, and 6.3 for 2024, 2025, and 2026 respectively [4] - The company’s revenue is expected to grow from 46.08 billion yuan in 2024 to 61.25 billion yuan in 2026, reflecting a compound annual growth rate [2][4]