FSSS(SH:600399) Guotai Junan Securities·2024-05-10 07:02Investment Rating - The report maintains a "Buy" rating for Fushun Special Steel (600399) with a target price of 9.00, down from the previous target of 11.50 [13][15]. Core Views - The company's core product sales continue to grow, and the technical transformation projects are gradually being implemented, which is expected to enhance profitability [13][15]. - The demand side is expanding into civilian markets, and the company's profitability is anticipated to recover from a low point [13][15]. - The forecast for net profit attributable to shareholders for 2024 is 5.83/7.2 billion, with an increase to 8.62 billion in 2026 [13][15]. Financial Summary - Revenue is projected to increase from 8,575 million in 2023 to 9,774 million in 2024, and further to 10,584 million in 2025 [15]. - The net profit attributable to shareholders is expected to rise from 362 million in 2023 to 583 million in 2024, and 720 million in 2025 [15]. - The company's operating profit margin is forecasted to improve from 4.8% in 2023 to 6.8% in 2024 [15]. Production and Sales - The company expects a continued increase in the production and sales volume of its core products, with high-temperature alloy product sales projected to reach 8,000 tons in 2023, a year-on-year increase of 17.4% [13][15]. - The company is actively developing demand in key varieties and has seen a 32% year-on-year increase in contract volume for its products [13][15]. Valuation - The report assigns a valuation of 30 times PE for 2024, slightly above the industry average of 27.08 times, reflecting the expected increase in production capacity due to technical upgrades [18].