Investment Rating - The report initiates coverage with a "Buy" rating for Meihua Holdings Group, assigning a target price of 14.38 yuan based on a 11.5x PE for FY26 [3][13]. Core Insights - The company has successfully merged with Kyowa Hakko Bio, enhancing its product pipeline and extending its industrial chain into the high value-added pharmaceutical grade amino acid market. This merger is expected to contribute approximately 780 million yuan in non-operating income for 2025 [1][11]. - The company has actively reduced the anti-dumping duty rate on lysine in the European Union from an initial 84.8% to 47.7%, improving its product competitiveness [4][15]. - Ongoing projects, such as the Tongliao MSG production capacity upgrade and the Jilin lysine project, are expected to significantly expand the company's operational scale [4][15]. - Increased investment in R&D and the establishment of a pilot research platform are aimed at enhancing the efficiency of converting research into industrial applications, supporting rapid commercialization of new products [4][15]. Financial Forecasts - The projected net profits for Meihua Holdings Group are 3.255 billion yuan for 2025, 3.504 billion yuan for 2026, and 3.793 billion yuan for 2027, reflecting a growth trajectory [3][5]. - Total revenue is expected to increase from 25.069 billion yuan in 2024 to 29.659 billion yuan by 2027, with a compound annual growth rate (CAGR) of approximately 6.1% [5][9]. - The company's earnings per share (EPS) is forecasted to grow from 0.98 yuan in 2024 to 1.35 yuan in 2027 [5][9]. Comparable Company Valuation - The report includes a comparison of Meihua Holdings Group's valuation with peers, indicating a favorable position with a lower PE ratio compared to some competitors, suggesting potential for price appreciation [6].