SDBH(SH:600966) Haitong Securities·2024-05-22 08:02Investment Rating - The investment rating for the company is "Outperform the Market" [13] Core Insights - The company reported a year-on-year sales increase in 2023, with Q1 2024 profits showing a sequential decline. In Q4 2023 and Q1 2024, the company achieved revenues of 5.015 billion and 4.398 billion yuan, representing year-on-year growth of 11.05% and 5.69%, respectively. The net profit attributable to shareholders was 275 million and 101 million yuan, with year-on-year increases of 171.44% and 120.23%. Despite steady revenue growth in Q1 2024, profitability showed a sequential decline [4][15] Summary by Sections Sales and Profitability - In 2023, the sales volume of white cardboard increased by 9.48% to 2.7969 million tons, but revenue decreased by 8.86% to 11.941 billion yuan. The sales volume of boxboard rose by 7.16% to 541,600 tons, with revenue down 11.16% to 1.832 billion yuan. The decline in revenue is attributed to falling packaging paper prices. Conversely, cultural paper sales surged by 124.91% to 840,500 tons, with revenue increasing by 105.92% to 4.245 billion yuan, mainly due to new production capacity contributions [4] Project Development - The company is advancing the construction of a new project in Jiangsu, aiming to expand its production capacity for high-end specialty paperboard. This project will focus on high-value differentiated products, including all-wood pulp "zero plastic" paper cup paper, high-end social card paper, and cigarette card paper, to better serve diverse customer needs in East China and overseas. Additionally, the Shandong base will accelerate the industrialization of sterile liquid packaging paper [5] Financial Forecast - The company is expected to achieve net profits of 672 million and 975 million yuan in 2024 and 2025, respectively, with year-on-year growth rates of 269.3% and 45.1%. The closing price on May 21 corresponds to a PE ratio of 11.9 and 8.2 for 2024 and 2025, respectively. The estimated reasonable value range is between 6.50 and 7.00 yuan, based on a PE valuation of 13-14 times for 2024 [17][21]