Cathay Biotech (SH:688065) Shanxi Securities·2024-05-05 09:00Investment Rating - The report maintains an "Accumulate-B" rating for the company [1] Core Views - The company experienced a revenue decline of 13.39% in 2023, with total revenue of 2.114 billion yuan and a net profit decrease of 33.75% to 367 million yuan. However, in Q1 2024, revenue increased by 35.43% year-on-year to 685 million yuan, and net profit surged by 83.25% to 105 million yuan [1][2] - The demand for long-chain dicarboxylic acids was under pressure in 2023, but there was a notable recovery in Q1 2024, driven by increased sales efforts and improved market conditions [1] - The company is well-positioned in the bio-based polyamide market, which is expected to exceed 20 billion yuan by 2025, with significant carbon emission reduction advantages compared to petrochemical-based products [1][2] Financial Performance Summary - In 2023, the company reported a revenue of 2.114 billion yuan, down from 2.441 billion yuan in 2022, with a net profit of 367 million yuan compared to 553 million yuan in 2022 [2][3] - The gross margin for 2023 was 28.8%, a decrease of 6.4 percentage points from 2022 [2] - Forecasts for 2024 to 2026 predict revenues of 2.958 billion yuan, 4.719 billion yuan, and 7.318 billion yuan, respectively, with corresponding net profits of 473 million yuan, 658 million yuan, and 832 million yuan [1][3] - The company’s EPS is projected to increase from 0.81 yuan in 2024 to 1.43 yuan in 2026, with a PE ratio decreasing from 63.3 to 36.0 over the same period [2][3]