Chanhen(SZ:002895)2024-05-24 08:02Investment Rating - The report maintains an "Outperform" rating for the company [7][9]. Core Views - The company's performance in Q1 2024 met expectations, with revenue of 1.044 billion yuan, a year-on-year increase of 4.53%, but a quarter-on-quarter decrease of 16.37%. The net profit attributable to the parent company was 135 million yuan, down 14.97% year-on-year and 51.02% quarter-on-quarter [7][9]. - The decline in net profit is attributed to lower prices for industrial monoammonium phosphate and feed-grade dicalcium phosphate, as well as inventory impairment losses due to falling prices of iron phosphate and purified phosphoric acid [7][9]. - The company is expected to benefit from the gradual production of new phosphate chemical projects and mining operations, which will support future growth [7][9]. Financial Summary - Total revenue for 2022 was 3.447 billion yuan, projected to increase to 4.320 billion yuan in 2023, and further to 5.187 billion yuan in 2024 [3][13]. - The net profit attributable to the parent company is expected to rise from 766 million yuan in 2023 to 1.005 billion yuan in 2024, with a projected EPS of 1.85 yuan [3][13]. - The gross profit margin is expected to stabilize around 35% for the coming years, despite a decline in Q1 2024 to 33.83% [7][13]. Market Data - As of May 23, 2024, the closing price of the stock was 20.55 yuan, with a market capitalization of 10.274 billion yuan [8]. - The stock has a price-to-earnings ratio of 11X for 2024, indicating a favorable valuation compared to future earnings growth [7][8].