Sichuan Guoguang Agrochemical (SZ:002749) Haitong Securities·2024-04-30 01:02Investment Rating - The investment rating for the company is "Outperform the Market" [9][21]. Core Insights - The company's sales gross margin significantly improved, with a year-on-year increase of 3.68 percentage points to 41.55% in 2023, primarily due to a decrease in upstream raw material prices since Q4 2022. The sales expense ratio decreased by 0.97 percentage points to 12.70%, and the management expense ratio decreased by 0.49 percentage points to 6.44%, leading to a net profit margin increase of 10.26 percentage points to 17.25% [10]. - The company reported a net profit of 302 million yuan in 2023, a year-on-year increase of 165.89%, with a non-recurring net profit growth of 197.42% [19]. - The market for plant growth regulators is expected to grow significantly, with a potential market capacity of 630 billion yuan if full penetration is achieved in key agricultural sectors [20]. Financial Summary - Revenue is projected to grow from 1,860 million yuan in 2023 to 2,835 million yuan by 2026, with a compound annual growth rate (CAGR) of 16.9% [10][32]. - Net profit is expected to increase from 302 million yuan in 2023 to 527 million yuan by 2026, with corresponding earnings per share (EPS) rising from 0.68 yuan to 1.19 yuan [21][32]. - The gross margin is forecasted to improve from 41.5% in 2023 to 44.4% by 2026, reflecting enhanced operational efficiency [10][32]. Business Segmentation - The company’s revenue from pesticides is projected to reach 1,270.10 million yuan in 2024, with a gross margin of 47.00% [13]. - Fertilizer revenue is expected to be 488.63 million yuan in 2024, with a gross margin of 34.00% [13]. - Other business segments are anticipated to generate 101.07 million yuan in revenue in 2024, maintaining a gross margin of 40.50% [13].