Cathay Biotech (SH:688065) Haitong Securities·2024-05-15 00:32Investment Rating - The investment rating for the company is "Outperform the Market" [2] Core Views - The report emphasizes the company's focus on expanding downstream operations and increasing R&D investment to accumulate growth potential [6] - The company reported a revenue of 2.114 billion yuan in 2023, a year-on-year decrease of 13.39%, and a net profit of 367 million yuan, down 33.75% year-on-year. However, in Q1 2024, revenue increased to 685 million yuan, up 35.43% year-on-year, with a net profit of 105 million yuan, up 83.25% year-on-year [6] - The company is committed to enhancing its technological competitiveness through innovation and R&D, with R&D expenses amounting to 189.128 million yuan in 2023, representing 8.95% of revenue, a 0.75% increase from the previous year [6] - The company has made significant progress in various R&D projects, including green dicarboxylic acids and bio-based materials, which are expected to support future business development [6] Financial Summary - The company forecasts revenues of 2.787 billion yuan in 2024, 3.285 billion yuan in 2025, and 3.670 billion yuan in 2026, with corresponding net profits of 425 million yuan, 472 million yuan, and 574 million yuan respectively [7][11] - The projected EPS for 2024, 2025, and 2026 are 0.73 yuan, 0.81 yuan, and 0.98 yuan respectively, with a projected BPS of 19.84 yuan for 2024 [6][11] - The report estimates a reasonable valuation range of 57.54 to 59.52 yuan for 2024, based on a PB ratio of 2.90 to 3.00 [6]