CJS(SH:600176) Minsheng Securities·2024-04-26 09:30Investment Rating - The report maintains a "Recommended" rating for the company, China Jushi [6][7]. Core Views - The company reported a bottoming out in Q1 2024, with expectations for gradual recovery in profitability [3]. - The report highlights a significant decline in revenue and net profit year-on-year, with Q1 2024 revenue at 3.382 billion yuan, down 7.86%, and net profit at 350 million yuan, down 61.97% [3][4]. - The report anticipates a recovery in the pricing of glass fiber products, particularly in the direct yarn segment, driven by inventory destocking and price adjustments by leading companies [6]. Financial Forecasts and Indicators - Revenue projections for the company are as follows: 2023A: 14.876 billion yuan, 2024E: 16.515 billion yuan, 2025E: 19.508 billion yuan, 2026E: 21.646 billion yuan, with growth rates of -26.3%, 11.0%, 18.1%, and 11.0% respectively [7][11]. - The net profit attributable to shareholders is forecasted to be: 2023A: 3.044 billion yuan, 2024E: 2.834 billion yuan, 2025E: 3.890 billion yuan, 2026E: 4.636 billion yuan, with growth rates of -53.9%, -6.9%, 37.3%, and 19.2% respectively [7][11]. - The report projects earnings per share (EPS) to be: 2023A: 0.76 yuan, 2024E: 0.71 yuan, 2025E: 0.97 yuan, 2026E: 1.16 yuan [7][11]. - The price-to-earnings (PE) ratio is expected to be 16x in 2023, increasing to 17x in 2024, and then decreasing to 12x and 10x in 2025 and 2026 respectively [7][11]. Industry Insights - The report notes that the glass fiber industry is experiencing a price stabilization trend, with expectations for price elasticity in electronic cloth products [10]. - The report emphasizes the importance of supply-demand dynamics, particularly in the context of inventory levels and production adjustments among smaller manufacturers [5][6]. - The anticipated recovery in demand from overseas markets, particularly in Southeast Asia and South Asia, is highlighted as a potential catalyst for growth [6].