SLCT(SH:600691) EBSCN·2024-05-08 00:32Investment Rating - The report maintains an "Accumulate" rating for the company [6][8]. Core Views - The company has significantly reduced losses in Q1 2024 due to declining raw material costs and effective cost control measures, despite a challenging chemical industry environment [5][6]. - The company is strategically positioning itself in the hydrogen energy sector, leveraging its production capacity and technological advantages to create new profit growth points [4][5]. Summary by Relevant Sections Financial Performance - In Q1 2024, the company achieved a revenue of 2.8 billion yuan, a year-on-year decrease of 29% but a quarter-on-quarter increase of 5% [4]. - The net profit attributable to shareholders was -37 million yuan, an improvement from -530 million yuan year-on-year and an increase of 1.1 billion yuan quarter-on-quarter [4]. - The company’s main products, including urea and PVC, saw significant price declines, impacting overall revenue [5]. Hydrogen Energy Sector - The company has subsidiaries focused on hydrogen energy, including Zhengyuan Hydrogen and Yangxiong Hydrogen, and is involved in joint ventures to expand its hydrogen energy business [4]. - Zhengyuan Hydrogen has developed proprietary technologies for hydrogen production, positioning itself as a major supplier in the Hebei province [4]. Profit Forecast and Valuation - The profit forecasts for 2024-2026 have been adjusted downward due to weak market demand and declining product prices, with expected net profits of 61 million yuan, 101 million yuan, and 132 million yuan respectively [6]. - The report highlights the company's ongoing projects and its potential for growth in the hydrogen energy sector, justifying the "Accumulate" rating despite the challenges faced [6].