SUN PAPER(SZ:002078) Minsheng Securities·2024-04-09 16:00Investment Rating - The report maintains a "Recommended" rating for the company with a target price of 15.05 yuan [3]. Core Views - The company achieved a revenue of 39.544 billion yuan in 2023, a slight decrease of 0.56% year-on-year, while the net profit attributable to shareholders increased by 9.86% to 3.086 billion yuan [3]. - The report highlights that the company's integrated operations in the forestry, pulp, and paper sectors continue to demonstrate strong alpha attributes, with profitability improving gradually [3][4]. - The report anticipates that the price of pulp will continue to rise in the second half of 2023, leading to improved profitability [3]. Summary by Sections Financial Performance - In Q4 2023, the company reported a revenue of 10.342 billion yuan, a year-on-year increase of 2.13%, with net profit attributable to shareholders reaching 949 million yuan, reflecting a significant growth of 75.51% [3]. - The overall gross margin and net margin for 2023 increased to 16.21% and 7.84%, respectively, indicating improved profitability [3]. - The company’s cash flow from operating activities for 2023 was 6.617 billion yuan, a year-on-year increase of 73.07% [3]. Revenue Breakdown - Revenue from various product lines in 2023 included non-coated cultural paper (13.31 billion yuan), coated paper (3.506 billion yuan), dissolving pulp (3.667 billion yuan), and corrugated box paper (9.807 billion yuan), with respective year-on-year changes of +2.58%, +10.38%, -12.08%, and -5.65% [3]. - The average prices for various paper products decreased in 2023, with declines of 3.5% for double glue paper, 2.7% for coated paper, 7.4% for corrugated paper, and 13.1% for dissolving pulp [3]. Future Outlook - The company is expected to distribute dividends of 838 million yuan in 2023, with a dividend payout ratio of 27.17% [4]. - Forecasts for net profit attributable to shareholders for 2024-2026 are 3.511 billion yuan, 3.847 billion yuan, and 4.183 billion yuan, respectively, with corresponding PE ratios of 12X, 11X, and 10X [5][6].