HYMD(SH:600971) Guohai Securities·2024-04-30 11:32Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [1]. Core Insights - The company has demonstrated strong cash cow attributes, with a high cash balance and low debt pressure, reflected in a 2023 weighted return on equity (ROE) of 16.7% and a debt-to-asset ratio of 38.8% as of March 2024 [6][19]. - The company is expected to experience stable revenue growth, with projected revenues of 75.6 billion, 78.2 billion, and 80.2 billion yuan for 2024, 2025, and 2026 respectively, indicating a slight decline in 2024 followed by growth in subsequent years [19][20]. - The company benefits from a high proportion of long-term contracts in its coal business, which stabilizes earnings and reduces volatility [19]. Summary by Sections Recent Performance - In Q1 2024, the company reported a revenue of 2.05 billion yuan, a year-on-year decrease of 8.3%, and a net profit attributable to shareholders of 430 million yuan, down 29.1% year-on-year [3][4]. Coal Business - The company produced 1.949 million tons of commodity coal in Q1 2024, a 4% increase quarter-on-quarter and a 12% increase year-on-year. The average selling price per ton was 1,017 yuan, up 12% quarter-on-quarter but down 5% year-on-year [4]. - The comprehensive cost per ton of coal was 561 yuan, showing a slight decrease of 1% quarter-on-quarter and 3% year-on-year, resulting in a comprehensive gross profit of 456 yuan per ton, which is a 35% increase quarter-on-quarter but a 7% decrease year-on-year [4]. Financial Metrics - The company had a total market capitalization of approximately 15.43 billion yuan and a daily average trading volume of 207.79 million yuan [4]. - The projected earnings per share (EPS) for 2024, 2025, and 2026 are estimated at 1.64, 1.74, and 1.80 yuan respectively, with corresponding price-to-earnings (P/E) ratios of 8, 7, and 7 [19][20]. Future Growth Potential - The company is expected to benefit from the upcoming commissioning of the second phase of the Qianyingzi power plant, which will add significant capacity and contribute to revenue growth [19][18]. - There is potential for increased coal production capacity due to the rich resources of its controlling shareholder, Anhui Wanjin Coal and Electricity Group, which has committed to injecting coal mining assets into the listed company [4][19].