Shennong Group(605296) 光大证券·2024-04-30 14:02Investment Rating - The report maintains a "Buy" rating for the company, indicating strong growth potential and cost control capabilities [5][17]. Core Insights - The company reported a significant increase in pig production, with a total of 496,800 pigs slaughtered in Q1 2024, representing a year-on-year growth of 40.94% and a quarter-on-quarter growth of 21.68% [2]. - The company's revenue for Q1 2024 reached 1.082 billion yuan, a year-on-year increase of 20.82% and a quarter-on-quarter increase of 5.93%, while the net profit attributable to the parent company was a loss of 3.57 million yuan, significantly reduced from a loss of 106 million yuan in the same period last year [4]. - The report highlights improvements in cost management, with breeding costs reduced to 13.5 yuan per kilogram and total costs to 14.5 yuan per kilogram, driven by lower piglet costs and feed prices [13]. Summary by Sections Production and Capacity - The company achieved a high increase in pig production, with 496,800 pigs slaughtered in Q1 2024, a 40.94% increase year-on-year and a 21.68% increase quarter-on-quarter [2]. - The breeding sow count is approximately 90,000, with expectations to reach nearly 130,000 by the end of 2024, supporting a target of 3.5 million pigs slaughtered in 2025 [2]. Financial Performance - Q1 2024 revenue was 1.082 billion yuan, up 20.82% year-on-year and 5.93% quarter-on-quarter, with a net profit loss of 3.57 million yuan, a significant reduction from a loss of 106 million yuan in the previous year [4]. - The report projects an increase in net profit attributable to the parent company to 492 million yuan in 2024, with an EPS forecast of 0.94 yuan [5][14]. Cost Management - The company has successfully reduced breeding costs to 13.5 yuan per kilogram and total costs to 14.5 yuan per kilogram, aided by lower piglet costs and feed prices [13]. - The feed cost decreased by approximately 0.6 yuan per kilogram compared to Q4 2023, and the feed-to-meat ratio improved to 2.57 in Q1 2024 [13].