Zhongfu Shenying Carbon Fiber (SH:688295) EBSCN·2024-05-06 01:02Investment Rating - The report maintains a "Buy" rating for Zhongfu Shenying (688295.SH) with a current price of 26.67 CNY [2] Core Views - Despite a downturn in the carbon fiber industry, Zhongfu Shenying achieved a significant increase in sales volume, leading to a notable rise in market share [10] - The company has demonstrated cost reduction and efficiency improvements through scale effects, with a substantial increase in production capacity expected in the coming years [7][10] Summary by Sections Revenue Performance - In 2023, Zhongfu Shenying reported total revenue of 2.3 billion CNY, a year-on-year increase of 13%, while net profit decreased by 47% to 320 million CNY [5] - The Q4 2023 results showed a total revenue of 650 million CNY, with a net profit of 25 million CNY, reflecting a significant decline in profitability [5] Production and Market Position - The company’s carbon fiber production capacity reached 28,500 tons by the end of 2023, ranking among the top three globally, with plans to expand to 60,000 tons by 2026 [7] - In 2023, the company achieved a market share of approximately 26%, an increase of 13.5 percentage points year-on-year, despite a decline in overall industry demand [8] Cost and Profitability - The cost of carbon fiber products decreased by 21% year-on-year, leading to a gross profit margin of 30.2%, down 17.6 percentage points from the previous year [6] - The report anticipates a recovery in profitability in 2024, supported by a slight increase in carbon fiber prices observed in April 2024 [9] Financial Projections - The forecast for net profit is adjusted to 330 million CNY for 2024 and 470 million CNY for 2025, with a new projection of 580 million CNY for 2026 [10] - The current price corresponds to a dynamic P/E ratio of 72x for 2024, indicating potential for growth as new production capacity comes online [10]