Kings(603505) 国联证券·2024-04-22 15:30Investment Rating and Valuation - The report maintains a "Buy" rating for the company with a target price of 34.89 RMB for 2024 [1][2] - The company's 2024-26 revenue is forecasted at 3.92/5.01/5.58 billion RMB, with growth rates of 107%/28%/12% respectively [1] - Net profit attributable to shareholders is expected to be 700/970/1,104 million RMB, with growth rates of 102%/38%/14% [1] - EPS is projected at 1.16/1.60/1.83 RMB per share, with a 3-year CAGR of 47% [1] Core Financial Data and Projections - Revenue for 2022-2026 is forecasted at 1,050/1,896/3,921/5,007/5,583 million RMB [1] - EBITDA for the same period is projected at 454/669/1,492/1,986/2,224 million RMB [1] - The company's P/E ratio is expected to decrease from 85.0 in 2022 to 17.1 in 2026 [1] - ROE is forecasted to increase from 16.44% in 2022 to 32.67% in 2025 before slightly decreasing to 28.73% in 2026 [12] Business Model and Growth Strategy - The company's light-asset model leverages technology to access resources, which is expected to be replicable [1] - The company is expanding globally, with potential for further integration of global resources [1] - The "selection and chemical integration" project is gradually being implemented, contributing to the company's performance [18] - The company is transitioning into a technology platform company, with a focus on light-asset operations [20] Industry and Market Position - The company operates in the basic chemicals/chemical products industry [2] - The company's stock price has shown a relative performance of -30% to 40% compared to the CSI 300 index from 2023/4 to 2024/4 [3] - The company's market capitalization is 18,899.13 million RMB, with a total share capital of 604.77 million shares [2] Recent Performance and Outlook - Q1 2024 revenue was 448 million RMB, a 166% YoY increase, with a net profit of 61 million RMB, up 75% YoY [17] - The company produced 125,000 tons of fluorite concentrate and 23,800 tons of anhydrous hydrogen fluoride in Q1 2024 [18] - Fluorite prices are expected to recover in Q2, with current prices for anhydrous hydrogen fluoride rising to 11,000-11,500 RMB/ton [19] - The company's ROA is expected to perform well due to its light-asset model [20] Global Expansion - The company is starting its global expansion in Mongolia, aiming to integrate global scarce resources [21] - The company's technology is well-suited to address the pain points of Mongolian mining, potentially serving as a starting point for global resource integration [21]