XfmGroup(SH:603225) Huachuang Securities·2024-05-16 06:02Investment Rating - The report upgrades the investment rating of the company to "Strong Buy" [2][5] Core Views - The company reported a significant increase in Q1 profits, indicating a strong recovery potential for long filament profitability throughout the year [2] - The long filament prices improved both year-on-year and quarter-on-quarter, with PTA turning profitable [2] - The industry is expected to see a significant decline in new capacity growth in 2024, leading to an improved supply-demand balance and sustained profitability [2] - The company is steadily expanding its production capacity, which is expected to enhance its market position and growth potential [2] Financial Performance Summary - In Q1 2024, the company achieved revenue of 14.452 billion yuan, a year-on-year increase of 15.53% and a quarter-on-quarter decrease of 16.3% [2] - The net profit attributable to shareholders was 275 million yuan, up 45.25% year-on-year and 38.2% quarter-on-quarter [2] - The non-recurring net profit was 230 million yuan, reflecting a year-on-year increase of 102.96% and a quarter-on-quarter increase of 41.1% [2] - The company’s long filament sales volume in Q1 was 1.5782 million tons, a year-on-year increase of 16.9% but a quarter-on-quarter decrease of 18.1% [2] - The average price of POY, FDY, and DTY in Q1 was 6,900 yuan/ton, 7,800 yuan/ton, and 8,700 yuan/ton respectively, showing year-on-year increases of 2.4%, 4.5%, and 4.7% [2] Capacity and Market Position - The company currently has a total long filament capacity of 7.4 million tons and plans to add 400,000 tons in 2024 and 650,000 tons in 2025 [2] - The company is also expanding upstream with a PTA capacity of 5 million tons, aiming for 5.4 million tons in the future [2] - The company is involved in the Taikun Petrochemical refining project in Indonesia, which is expected to further enhance its cost advantages [2] Profit Forecast - The projected net profits for 2024, 2025, and 2026 are 1.911 billion yuan, 2.434 billion yuan, and 2.951 billion yuan respectively, with corresponding EPS of 1.25 yuan, 1.60 yuan, and 1.94 yuan [3][9] - The current market capitalization corresponds to PE ratios of 12x, 9x, and 8x for the years 2024 to 2026 [3][9]