Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 51.30 [7][8]. Core Insights - The company has experienced a significant year-on-year increase in pig output, with April's output reaching 8.11 million heads, a 49% increase compared to the previous year. Cumulatively, from January to April, the total output was 30.77 million heads, up 43% year-on-year [2]. - The complete breeding cost has improved significantly, dropping to RMB 12.4 per kilogram in April, a decrease of approximately RMB 0.7 per kilogram since the beginning of the year. The company aims to reduce the annual complete cost to RMB 12 per kilogram [2]. - The company is advancing its internationalization strategy by submitting an application for H-share issuance, which is expected to enhance its global business footprint and investor relations [3]. Summary by Sections Production and Cost Management - The company has successfully increased its pig output while reducing costs, with a clear path for further cost reductions through improved disease control and feed technology [2]. - The strategy to enhance the value of individual pigs through better meat quality and higher yield from valuable parts is also being implemented [2]. International Expansion and Investor Relations - The submission of the H-share listing application is a strategic move to tap into the global market, which is still expanding. This is expected to reshape the company's investment value perception [3]. - The company emphasizes sustainable cash dividends and plans to adjust its profit distribution policy dynamically to share development benefits with investors [3]. Financial Forecast and Valuation - The report maintains profit forecasts for the company, projecting net profits of RMB 19.73 billion, RMB 18.26 billion, and RMB 47.17 billion for the years 2025, 2026, and 2027 respectively [4]. - The estimated price-to-book ratio for 2025 is maintained at 3.3x, with a target price set at RMB 51.30 [4].

Core Viewpoint - The company has shown improved profitability in Q1 2025, driven by lower feed prices and enhanced production efficiency, leading to a decrease in the debt-to-asset ratio to 51% [1][3]. Financial Performance - In 2024, the company reported revenue of 104.9 billion yuan (up 17% year-on-year) and a net profit of 9.23 billion yuan (turning from loss to profit) [1]. - For Q4 2024, the company achieved revenue of 29.5 billion yuan (up 17% year-on-year) and a net profit of 2.82 billion yuan (turning from loss to profit) [1]. - In Q1 2025, the company reported revenue of 24.3 billion yuan (up 11% year-on-year) and a net profit of 2.0 billion yuan (turning from loss to profit) [2]. Segment Performance - In the pig farming segment for 2024, the company sold 30.18 million pigs (up 15% year-on-year) with estimated costs of 14.0-14.5 yuan/kg, achieving a profit of 280-330 yuan per pig [1]. - In the chicken farming segment for 2024, the company sold 1.21 billion chickens (up 2.1% year-on-year) with estimated costs of 12.0-12.5 yuan/kg, achieving a profit of 1.5-2.0 yuan per chicken [1]. - In Q1 2025, the company sold 8.59 million pigs (up 20% year-on-year), with estimated costs of 12.5-13.0 yuan/kg, achieving a profit of 270-320 yuan per pig [2]. - In Q1 2025, the company sold 282 million chickens (up 5.4% year-on-year), with estimated costs of 11.0-11.5 yuan/kg, incurring a loss of 0.8-1.3 yuan per chicken [2]. Cash Flow and Debt Management - The company experienced improved cash flow, with net operating cash inflows of 6.8 billion yuan in Q4 2024 and 3.82 billion yuan in Q1 2025, contributing to a decrease in the debt-to-asset ratio to 51% [3]. - The breeding stock of sows increased to approximately 1.74 million by the end of 2024, up 12% year-on-year, supporting stable production growth [3]. Investment Outlook - The company maintains a "strong buy" investment rating, with expected net profits of 9.16 billion yuan, 11.3 billion yuan, and 13.1 billion yuan for 2025-2027, corresponding to P/E ratios of 12X, 10X, and 8.6X respectively [3].

Core Viewpoint - The company reported strong Q1 2025 results with significant year-on-year growth in revenue and net profit, indicating robust operational performance and cost management strategies [1][2][4]. Group 1: Financial Performance - Q1 2025 revenue reached 36.061 billion yuan, a year-on-year increase of 37.26% but a quarter-on-quarter decrease of 12.41% [1]. - The net profit attributable to shareholders for Q1 2025 was 4.491 billion yuan, showing a year-on-year increase of 288.79% and a quarter-on-quarter decrease of 39.31% [1]. - The company sold 22.66 million pigs in Q1 2025, representing a year-on-year increase of 42% and a quarter-on-quarter increase of 5.6% [2]. Group 2: Operational Highlights - The average profit per pig was 200 yuan, significantly higher than the industry average of approximately 93 yuan, attributed to a decrease in breeding costs to around 12.9 yuan per kilogram [2]. - The slaughtering volume reached 5.29 million pigs in Q1 2025, a year-on-year increase of 80% and a quarter-on-quarter increase of 15% [2]. - The utilization rate of slaughtering capacity exceeded 70%, improving by over 30 percentage points year-on-year, driven by enhanced sales channels and operational management [2]. Group 3: Future Outlook - The company aims to achieve a target of 72 to 78 million market pigs and 8 to 12 million piglets in 2025, indicating a year-on-year growth of 10% to 19% for market pigs and 41% to 112% for piglets [3]. - The company plans to continue reducing costs through advancements in health management, breeding, nutrition research, and smart applications [3]. - The establishment of a subsidiary in Vietnam and plans for an H-share listing are expected to enhance the company's international presence and long-term growth potential [3]. Group 4: Valuation and Profit Forecast - The company has adjusted its profit forecasts for 2025, 2026, and 2027 to 19.7 billion, 18.3 billion, and 47.2 billion yuan respectively, reflecting increases of 39%, 36%, and 9% [4]. - The target price is set at 51.30 yuan, with a price-to-book ratio of 3.3x for 2025, maintaining a "buy" rating [4].