Xianhe(603733) 光大证券·2024-05-03 07:32Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for future performance [10]. Core Insights - The company reported a revenue of 2.21 billion yuan in Q1 2024, representing a year-on-year growth of 20.2%, and a net profit of 270 million yuan, which is a significant increase of 120.1% year-on-year [3][4]. - The strong performance is attributed to the release of new production capacity, particularly from the 300,000-ton food-grade paper project and the 300,000-ton specialty paper project, which commenced operations in April 2023 and January 2024, respectively [3]. - The company's gross margin improved significantly, reaching 18.0% in Q1 2024, an increase of 8.0 percentage points year-on-year, while remaining stable compared to the previous quarter [5]. - The report highlights the company's effective inventory management and cost control, which contributed to the improved gross margin [5]. - The company is expanding its "pulp-paper integration" strategy, with plans for an additional 800,000-ton self-produced pulp project expected to be fully operational by Q4 2024, enhancing its competitive advantage [5]. Financial Summary - The company’s total revenue is projected to grow from 8.55 billion yuan in 2023 to 11.59 billion yuan in 2024, reflecting a growth rate of 35.49% [6]. - The net profit is expected to increase from 664 million yuan in 2023 to 998 million yuan in 2024, with a growth rate of 50.27% [6]. - Earnings per share (EPS) are forecasted to rise from 0.94 yuan in 2023 to 1.41 yuan in 2024 [6]. - The report indicates a low valuation with price-to-earnings (P/E) ratios of 13, 9, and 7 for 2024, 2025, and 2026, respectively, suggesting potential for price appreciation [5][6].