NWF(SH:600975) Guolian Securities·2024-04-22 13:30Investment Rating - The investment rating for the company is "Buy" based on the expected performance relative to market indices [11]. Core Views - The company has experienced significant growth in pig production, with a 75% year-on-year increase in pig output, totaling approximately 3.2 million pigs by the end of 2023 [25]. - Despite the growth in output, the company faced substantial losses due to persistently low pig prices throughout 2023 [25]. - The company is expected to benefit from a reversal in the pig cycle in the second half of the year, leading to potential performance improvements [26]. Financial Data and Valuation - Revenue is projected to grow from 56.32 billion yuan in 2023 to 120.02 billion yuan by 2026, with growth rates of 12.52%, 46.59%, 26.64%, and 14.79% for the respective years [3][26]. - The company is expected to turn profitable in 2024, with a forecasted net profit of 269 million yuan, followed by 1.416 billion yuan in 2025 and 1.529 billion yuan in 2026, reflecting growth rates of 122.37%, 426.07%, and 7.96% respectively [3][26]. - Earnings per share (EPS) are projected to improve from -0.95 yuan in 2023 to 1.21 yuan in 2026 [3][26]. - The company has a strong financial position with a cash balance of 1.5 billion yuan and a credit line of over 5 billion yuan [9]. Operational Insights - The company has a robust breeding capacity with a total of 349,200 breeding pigs, including 209,900 sows, and an annual output capacity of 694,600 fat pigs [1]. - The slaughtering capacity is established at 2.05 million pigs per year, and the feed production capacity is nearly 1.2 million tons, with an additional 420,000 tons added in 2023 [1][9].