Summary of Conference Call on Investment Opportunities in the Paper Industry Industry Overview - The overall operating rate of the paper industry is below 2018 levels, with white paper down approximately 20%, household paper down about 19%, and packaging paper down 10-13% reflecting weak current demand [1][2] - The concentration of the paper industry is increasing, with outdated capacity mainly concentrated in corrugated paper, household paper, and some boxboard paper, accounting for about 10% [1][3] Key Insights and Arguments - Leading companies like Jiulong and Shanying are implementing price increases through intensive price notices, with expected continuation of this trend due to synergistic effects [1][3][12] - The double glue paper market is experiencing downward price pressure due to new capacity, but prices are expected to stabilize and recover from late August to September [1][5] - The white card paper market is facing significant impacts from new capacity, with prices at their lowest in five to ten years; large manufacturers are maintaining profitability through integrated pulp and paper operations [1][5] - The corrugated box market is nearing the end of new capacity investments, with demand still growing, and price increases observed at the end of July, improving gross margins [1][6] Future Changes and Regulations - The new national standard to be implemented in May 2025 will impose limits on paper energy consumption, particularly tightening limits for box and corrugated paper, which may accelerate the exit of outdated capacity [1][8] - Historical experiences indicate that the implementation of mandatory standards can lead to significant price increases and improved profit expectations for companies [1][8][9] Market Dynamics - The supply-demand situation in the domestic paper industry has worsened, with excess supply and significant impacts from imported paper [2] - The profitability of small manufacturers is declining, with many operating below the breakeven point, and the pressure from new capacity remains [5][10] - Large enterprises are expected to enhance their collaborative effects and cost advantages through integrated operations, which will further pressure small manufacturers [12] Administrative Measures and Their Impact - Previous administrative interventions have led to profit recovery but did not significantly increase capital expenditures (CAPEX) [9] - The current economic environment and macro background are affecting the pace of implementing new standards, but the enforcement of these standards is anticipated [8][9][11] Conclusion - The paper industry is facing a challenging environment with low operating rates and significant pressure from new capacities and imports. However, leading companies are expected to benefit from price increases and improved profitability through collaborative efforts and regulatory changes aimed at phasing out outdated capacity [1][7][12]

Core Viewpoint - Lee & Man Paper Manufacturing reported a slight revenue decline of 2.2% to HKD 12.2 billion in the first half of 2025, but achieved stable profit growth with a net profit of HKD 0.811 billion, a year-on-year increase of 0.7% [1][3] Group 1: Market Environment and Company Performance - The Chinese paper industry is experiencing a mild recovery, yet faces challenges such as capacity growth, raw material price fluctuations, and changes in export markets [3] - Lee & Man's integrated pulp and paper strategy has demonstrated strong resilience against market challenges, allowing for flexible capacity adjustments and effective risk mitigation [3] - The company sold a total of 3.49 million tons of products, with an average net profit of HKD 232 per ton [3] Group 2: Business Segments and Growth Potential - The packaging paper segment benefits from favorable policies aimed at promoting green packaging and circular economy initiatives, which are expected to enhance profitability [4] - The company is expanding its packaging paper business in response to the growth of e-commerce logistics, leveraging its integrated and intelligent production capabilities [4] - The hygiene paper segment focuses on high-end and environmentally friendly products, with increasing demand expected as consumer living standards rise [6] Group 3: Financial Performance and Operational Efficiency - In 2024, the total revenue reached HKD 25.995 billion, an increase from HKD 24.937 billion in 2023, but still below HKD 29.170 billion in 2022 [6] - The gross margin improved from 10.03% in 2023 to 11.97% in 2024, indicating effective cost control and product structure optimization [6] - The company's debt-to-asset ratio increased from 46.82% in 2023 to 49.39% in 2024, highlighting the need for careful debt management [6]

据悉，江津作为重庆工业强区，聚集5000余家企业，产业聚集度高达98.4%。区内已形成废纸回收、造 纸到包装成品的完整产业链——仅本地废纸年供应量即超百万吨，配套企业集群使运输成本降低20%； 枢纽优势赋能：坐拥西部陆海新通道主枢纽地位，江津"水公铁"多式联运体系将企业辐射半径几何级放 大。 玖龙纸业(02689)涨超4%，截至发稿，涨4.63%，报4.52港元，成交额4299.04万港元。 消息面上，据纸引未来网报道，近日，玖龙纸业60亿元林浆纸一体化智能工厂项目正式签约重庆枢纽港 产业园。据介绍，西南地区纸包装需求旺盛，却长期受制于原料短板。高昂的进口纸浆物流成本与本地 规模化绿色浆源的缺失，成为区域造纸业发展的紧箍咒。玖龙纸业此次落子，以"浆纸一体化"模式直击 行业痛点：一期建设70万吨绿色制浆生产线，实现原料自主；二期规划100万吨高档纸生产线，完善产 业链闭环；智能物流加持：项目紧邻长江货运码头(直线距离)。 ...

智通财经APP获悉，玖龙纸业(02689)涨超4%，截至发稿，涨4.63%，报4.52港元，成交额4299.04万港 元。 消息面上，据纸引未来网报道，近日，玖龙纸业60亿元林浆纸一体化智能工厂项目正式签约重庆枢纽港 产业园。据介绍，西南地区纸包装需求旺盛，却长期受制于原料短板。高昂的进口纸浆物流成本与本地 规模化绿色浆源的缺失，成为区域造纸业发展的紧箍咒。玖龙纸业此次落子，以"浆纸一体化"模式直击 行业痛点：一期建设70万吨绿色制浆生产线，实现原料自主；二期规划100万吨高档纸生产线，完善产 业链闭环；智能物流加持：项目紧邻长江货运码头(直线距离)。 据悉，江津作为重庆工业强区，聚集5000余家企业，产业聚集度高达98.4%。区内已形成废纸回收、造 纸到包装成品的完整产业链——仅本地废纸年供应量即超百万吨，配套企业集群使运输成本降低20%； 枢纽优势赋能：坐拥西部陆海新通道主枢纽地位，江津"水公铁"多式联运体系将企业辐射半径几何级放 大。 ...

Group 1: Packaging Paper Industry - From June 26, some paper manufacturers in Shandong started a new round of maintenance, exacerbating supply-demand conflicts in the packaging paper industry during the traditional off-season [1] - The packaging paper market, represented by corrugated and boxboard paper, continued its downward trend from the second half of 2024, with market average prices showing a decline both month-on-month and year-on-year [1] - Analysts indicate that the main reason for the difficulty in halting the decline in the packaging paper industry is the prominent supply-demand imbalance, with increased supply from new production capacity and weakened market demand due to a significant drop in export orders [1] Group 2: Cultural Paper Market - The cultural paper market also exhibited a "more declines than increases" trend in the first half of the year, with double offset paper prices overall declining and reaching near two-year lows [2] - The decline in terminal consumption and fluctuating external conditions have led to weak demand for double offset paper, resulting in frequent price fluctuations and market averages falling below expectations [2] - The dual pressure of prominent supply-demand imbalance and declining costs has led listed paper companies to focus on pulp-paper integration and digital transformation to reshape the competitive landscape [2] Group 3: Company Developments - Shandong Sun Paper Industry plans significant investments in 2025, with multiple projects in its Nanning base, including high-end packaging paper production lines and various pulp production lines, set to enter trial production in the fourth quarter of 2025 [3] - Shandong Huatai Paper has successfully launched China's first "industry brain" for paper making, utilizing AI to achieve full-process digitalization and intelligence from raw material procurement to production, sales, logistics, and finance [3] - Analysts predict that the overall oversupply in the packaging and cultural paper industries will remain unchanged, with expectations of continued price competition and low market prices in the short term [3]

Core Viewpoint - The company, as a leading player in the specialty paper industry, is expanding its production capacity and diversifying its product offerings, which is expected to enhance its revenue and profitability in the coming years [2][4][12]. Company Overview - The company has a total designed production capacity of 2.134 million tons per year, with key products including food packaging materials (780,000 tons/year) and glassine paper (210,000 tons/year) [3][18]. - The company has recently completed new production lines, including a 600,000 tons/year industrial packaging materials line in Hubei and a 10,000 tons/year digital transfer paper line in Jiangxi, which will further enhance its product supply capabilities [4][18]. Financial Performance - The company's revenue is projected to grow significantly due to the integration of acquired companies and the ramp-up of production capacity, with a notable increase in net profit expected [4][5]. - As of March 2025, the company's total assets were 116.84 billion, with total debt at 68.01 billion, indicating a high debt level and financial leverage [3][10]. Market Environment - The specialty paper market is experiencing pressure on sales prices due to increased competition and capacity expansion, particularly in the food packaging segment, which is affected by the decline in white cardboard prices [12][13]. - The demand for food packaging paper is supported by trends in the restaurant and takeaway sectors, driven by policies promoting eco-friendly packaging [13][14]. Risks and Challenges - The company faces risks related to the construction and operation of new projects, including a significant investment in a chemical pulp project and a public terminal project, which have long construction periods and uncertain operational outcomes [6][21]. - The company is also exposed to fluctuations in wood pulp prices and foreign exchange risks, as it continues to rely on imported wood pulp for its production [6][15]. Future Outlook - The company maintains a stable credit rating outlook, reflecting its strong market position and ongoing capacity expansion efforts [7]. - The overall industry is expected to see continued growth in production, but demand recovery remains uncertain, leading to potential supply-demand imbalances [12][15].

Core Viewpoint - The company is actively enhancing its operational efficiency and competitiveness through digital transformation and strategic projects in response to challenges in the paper and chemical industries. Group 1: Digital Transformation and Operational Efficiency - The company launched the "Industry Brain" project in April 2023, which is expected to improve production capacity by 8.57%, product quality by 7.6%, production efficiency by 5.8%, and transportation efficiency by 15% during its trial run in 2024 [2] - The "Industry Brain" integrates five major models covering the entire process from raw material procurement to production, sales, logistics, and finance, aiming to create a smart business model in the paper industry [2][3] - The project aims to reduce reliance on manual experience and enable rapid adjustments in production parameters, facilitating flexible production [2] Group 2: Strategic Projects and Market Positioning - The company has completed the construction of a 700,000-ton chemical wood pulp project, which is expected to enhance product scale, cost, and quality advantages, while ensuring raw material supply [3] - The company is focusing on integrating pulp and paper production to mitigate the impact of raw material price fluctuations and align with carbon neutrality trends [4] - The company is transitioning towards high-end cultural paper and specialty paper, with successful product development in various new categories following the relocation and renovation of its subsidiary [5] Group 3: Future Plans and Industry Position - The company plans to accelerate the transformation of research achievements and promote the advancement of Industry 4.0 in the paper sector by 2025 [3] - The company aims to extend its salt chemical and fine chemical industry chains, enhancing upstream resource development and downstream new product production to improve profitability in the chemical sector [5]

Core Insights - The company reported a revenue of 10.27 billion yuan for 2024, representing a year-on-year increase of 20.1%, and a net profit attributable to shareholders of 1 billion yuan, up 51.2% year-on-year [1] - The company experienced a decline in net profit in Q4 2024 and Q1 2025, attributed to price decreases and impairment impacts, although there was a marginal improvement in profitability in Q1 2025 [1] - The company’s gross profit margin for 2024 was 15.5%, an increase of 3.8 percentage points, while the net profit margin was 9.8%, up 2 percentage points [1] Revenue and Profit Analysis - In Q4 2024, the company achieved a revenue of 3.01 billion yuan, a year-on-year increase of 28.6%, but the net profit attributable to shareholders fell to 190 million yuan, down 33.7% [1] - For Q1 2025, revenue was 2.99 billion yuan, reflecting a year-on-year increase of 35.4%, with a net profit of 240 million yuan, down 12.1% [1] - The gross profit margin in Q4 2024 decreased to 12.8%, down 5.2 percentage points, while the net profit margin was 6.2%, down 5.8 percentage points [1] Volume and Price Dynamics - The company achieved a sales volume of 1.223 million tons in 2024, a year-on-year increase of 25.9%, benefiting from capacity release in Hubei and Guangxi projects [2] - The average selling price per ton in 2024 was approximately 8,400 yuan, a decrease of 400 yuan, while the net profit per ton (including investment income) was about 820 yuan, an increase of 140 yuan [2] - It is estimated that the selling price per ton in Q1 2025 will decline compared to 2024 due to market competition [2] Project Developments - The Hubei and Guangxi projects began operations in 2024, with significant production outputs contributing to the company's growth [3] - The Guangxi base produced 100,000 tons of wood pulp and 28,700 tons of specialty paper, while the Hubei base produced 59,800 tons of wood pulp and 93,400 tons of specialty paper [3] - The company plans to expand the Guangxi project in 2025, adding 600,000 tons of pulp and 700,000 tons of specialty paper capacity, enhancing its production capabilities [3] Investment Outlook - The company is expected to achieve revenues of 13.2 billion yuan, 15.4 billion yuan, and 18 billion yuan from 2025 to 2027, with year-on-year growth rates of 29%, 16%, and 17% respectively [4] - Projected net profits for the same period are 1.19 billion yuan, 1.38 billion yuan, and 1.59 billion yuan, reflecting year-on-year increases of 19%, 16%, and 16% [4] - The company maintains a "buy" rating based on its management and manufacturing advantages, as well as a comprehensive product matrix [4]

Report Information - Report Name: Pulp Daily Report [1] - Date: May 7, 2025 [2] Industry Investment Rating - Not provided Core Viewpoints - The pulp market is under pressure due to a significant reduction in cost support, a loose supply situation, and weak demand, resulting in an overall weak fundamental pattern [7] Summary by Section 1. Market Review and Operation Suggestions - Pulp futures contract 09 closed at 5064 yuan/ton, down 1.90% from the previous settlement price of 5162 yuan/ton [7] - The intended transaction price range of softwood pulp in the Shandong wood pulp market was 5300 - 6800 yuan/ton, with the low - end price down 80 yuan/ton from the previous trading day. The Shandong Yinxing was quoted at 6250 yuan/ton [7] - Chile's Arauco adjusted its April prices. The softwood pulp Yinxing was priced at 770 US dollars/ton, and the hardwood pulp Mingxing was priced at 560 US dollars/ton, showing a significant decline [7] - European port data showed that the total port inventory increased by 7.60% month - on - month and 25.96% compared to March 2024. Most ports except Germany's had a month - on - month increase in inventory [7] - The total pulp imports in March were 3.25 million tons, up 0.9% month - on - month and 2.5% year - on - year [7] - As of April 30, 2025, the weekly pulp inventory in major domestic regions and ports decreased by 2.12% month - on - month, with different shipping speeds at each port, and Gaolan Port had relatively concentrated arrivals [7] 2. Industry News - On May 1, the 35 - ton/day comprehensive chlorine dioxide preparation system provided by Boshike for Shandong Huatai Paper achieved full - line operation. It is the core unit of Huatai Paper's 700,000 - ton chemical pulp project, the largest newly - put - into - production chemical pulp project in China in 2025 [8] - After the successful operation of the system, Huatai Paper's wood pulp self - sufficiency rate reached 85%, and the comprehensive cost per ton of pulp decreased by 15% year - on - year [8] 3. Data Overview - The report presents multiple data charts, including import bleached softwood pulp spot prices in Shandong, pulp futures prices, pulp futures - spot price differences, softwood - hardwood price differences, inter - period price differences, warehouse receipt totals, domestic main port pulp inventories, European main port wood pulp inventories, paper product prices and price differences, and the US dollar - RMB exchange rate [12][14][17][19][25][27]

Report Overview - Report Title: Pulp Daily Report - Report Date: April 30, 2024 - Industry: Pulp 1. Investment Rating - No investment rating information is provided in the report. 2. Core View - The fundamental pattern of the pulp market remains weak, and pulp prices are mainly under pressure. The decline in pulp futures prices, the decrease in the low - end price of Shandong wood pulp market, and the weak downstream demand all indicate a weak market situation [8]. 3. Summary by Section 3.1 Market Review and Operation Suggestions - **Pulp Futures**: The previous settlement price of the pulp futures 09 contract was 5310 yuan/ton, and the closing price was 5152 yuan/ton, a decline of 2.98% [8]. - **Shandong Wood Pulp Market**: The intended transaction price range of softwood pulp in the Shandong wood pulp market was 5300 - 6800 yuan/ton. The low - end price dropped by 80 yuan/ton compared with the previous trading day's closing price. The price of Shandong Silver Star was 6250 yuan/ton [8]. - **Arauco's Price Adjustment**: Chilean Arauco adjusted its April prices. The price of softwood pulp Silver Star was 770 US dollars/ton, and the price of hardwood pulp Star was 560 US dollars/ton, showing a significant decline compared with the previous period [8]. - **European Pulp Data**: In March 2025, the consumption of European chemical pulp was 865,700 tons, a year - on - year decrease of 3.24%. The inventory was 707,300 tons, a year - on - year increase of 6.24%. The inventory days were 26 days, an increase of 1 day compared with the same period last year. The total pulp imports in March were 3.25 million tons, a month - on - month increase of 0.9% and a year - on - year increase of 2.5% [8]. - **Domestic Pulp Inventory**: As of April 24, 2025, the weekly pulp inventory in major domestic regions and ports was 2.0794 million tons, an increase of 4.08% compared with the previous week. Due to insufficient follow - up of terminal orders, downstream shipping pressure was obvious, and the raw material procurement intention was poor [8]. 3.2 Industry News - **Shandong Huatai Paper Project**: On April 12, Shandong Huatai Paper's 700,000 - ton chemical pulp project, undertaken by China National Light Industry International, was put into commissioning. The project team completed the entire construction task in 24 months. After the project, Huatai Paper's self - sufficiency rate of wood pulp increased significantly to 85%, and the comprehensive cost per ton of pulp decreased by 15% compared with external purchases. The project is equipped with a 3,200 TDS/D alkali recovery boiler, which can generate 568 tons of high - temperature and high - pressure steam per hour and has a power generation capacity of 1 million kilowatts. It can supply an additional 100,000 kilowatts of electricity to the grid. This innovation can save 500,000 tons of standard coal and reduce carbon dioxide emissions by 1.2 million tons annually [9].