Investment Rating - The investment rating for the company is "Buy" (maintained) [8] Core Views - The company reported a strong performance in H1 2025, achieving operating revenue of 23.46 billion yuan, a year-on-year increase of 20.93%, and a net profit attributable to shareholders of 2.744 billion yuan, up 33.44% year-on-year [4][14] - In Q2 2025, the company generated operating revenue of 11.131 billion yuan, reflecting a year-on-year increase of 5.05% but a quarter-on-quarter decrease of 9.72%. The net profit for the same period was 1.175 billion yuan, up 13.72% year-on-year but down 25.07% quarter-on-quarter [4][14] - The increase in ethane costs has slightly impacted the company's performance, with the average price of ethane in the U.S. rising by 27.28% year-on-year in Q2 2025 [14] - The C3 product price spread has widened, leading to improved profitability in the C3 segment, with average price spreads for various products showing significant year-on-year increases [15] - The easing of tariffs is expected to stabilize raw material costs, reinforcing the company's cost advantages and strong profitability in core business [16] - The company is projected to achieve net profits of 5.1 billion yuan, 6.6 billion yuan, and 8.2 billion yuan for the years 2025 to 2027, respectively, with corresponding EPS of 1.51 yuan, 1.97 yuan, and 2.43 yuan [17] Financial Data Summary - For H1 2025, the company reported operating revenue of 23.46 billion yuan and a net profit of 2.744 billion yuan [4][14] - The projected operating revenues for 2025, 2026, and 2027 are 54.126 billion yuan, 67.454 billion yuan, and 78.681 billion yuan, respectively, with growth rates of 18.57%, 24.62%, and 16.64% [18] - The projected net profits for the same years are 5.097 billion yuan, 6.622 billion yuan, and 8.183 billion yuan, with growth rates of -16.06%, 29.92%, and 23.58% [18]

Core Viewpoint - The company forecasts a net profit attributable to shareholders of 2.7-3.15 billion yuan for the first half of 2025, representing a year-on-year growth of 31.32%-53.2% [1] - The company expects a net profit of 2.852-3.302 billion yuan after deducting non-recurring items, with a year-on-year increase of 27.65%-47.79% [1] Financial Performance - For Q2 2025, the company anticipates a net profit of 1.13-1.58 billion yuan, showing a year-on-year growth of 9%-53% but a quarter-on-quarter decline of 28%-1% [1] - The expected net profit after deducting non-recurring items for Q2 2025 is 1.16-1.61 billion yuan, with a year-on-year change of -1%-37% and a quarter-on-quarter decrease of 5%-31% [1] - The decline in Q2 2025 performance is attributed to falling oil prices leading to narrowed product price spreads and increased costs from PDH unit maintenance [1] Product Price Spreads - The calculated price spreads for Q2 2025 are 567 USD/ton for ethane-ethylene, 823 RMB/ton for styrene, and 393 RMB/ton for ethylene glycol, with changes of -43 USD/ton, +499 RMB/ton, and +126 RMB/ton respectively [2] - Despite some tariff disruptions on ethane imports, the overall impact is limited, and the supply-demand balance for ethane remains loose, suggesting continued low prices and improved profitability for ethylene production [2] - The decline in oil prices has led to a narrowing of C3 product price spreads, with calculated spreads for propane to propylene, acrylic acid, and butyl acrylate being 68 USD/ton, 2038 RMB/ton, and 2509 RMB/ton respectively, reflecting decreases of -35 USD/ton, -357 RMB/ton, and -718 RMB/ton [2] Project Development - The progress of new material projects has slowed due to Sino-U.S. trade impacts, with planned capacities for 2025 including 40,000 tons of EAA, 160,000 tons of high polymer emulsion, 150,000 tons of SAP, 80,000 tons of neopentyl glycol, and 100,000 tons of refined propylene acid [3] - The company's future growth is primarily dependent on the α-olefin comprehensive utilization high-end new material industrial park project, with the third phase expected to be completed in the second half of 2026 and gradually contribute to performance from 2026 to 2027 [3] - The fourth phase of the project has been delayed due to Sino-U.S. trade issues [3] Investment Analysis - The company maintains its profit forecast for 2025 but has lowered the profit predictions for 2026-2027 to 7.7 billion and 9.4 billion yuan, respectively, from previous estimates of 9.2 billion and 11.5 billion yuan [3] - The corresponding PE valuations are adjusted to 9X, 8X, and 6X for the years 2025, 2026, and 2027 [3] - The company remains optimistic about the growth potential of the C2 segment and the recovery of the C3 segment, maintaining a "buy" rating [3]