Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [2]. Core Insights - The company has established a performance turning point with the growth in nitrocellulose demand and a contraction in supply. In the first four months of 2025, China's nitrocellulose export volume reached 7.6 million tons, a year-on-year increase of 39%, with export value rising by 86% to 250 million yuan [5][8]. - The company's revenue target for 2025 is set at 2.6 billion yuan, representing a 34% year-on-year growth, with a projected net profit of 140 million yuan, indicating a significant increase of 412% [6][9]. Company Overview - The latest closing price of the company's stock is 14.49 yuan, with a total market capitalization of 8 billion yuan. The company has a total share capital of 549 million shares, and its debt-to-asset ratio stands at 34.3% [4][6]. - The company experienced a revenue decline of 9.83% in 2024, with a net loss of 28 million yuan, primarily due to the return of overpaid prices for special order products [6][9]. Business Performance - Nitrocellulose business achieved a revenue of 703 million yuan in 2024, with a gross margin of 31.24%. Despite a revenue decline due to the shutdown of a production line, the gross margin reached a new high in recent years [6][7]. - The company is expected to benefit from the global increase in ammunition demand, with significant growth in both military and civilian applications for nitrocellulose [7][8]. Financial Projections - The company forecasts revenues of 2.61 billion yuan in 2025, 3.21 billion yuan in 2026, and 3.87 billion yuan in 2027, with corresponding net profits of 137 million yuan, 300 million yuan, and 428 million yuan respectively [12][13]. - The projected price-to-earnings ratios for the next three years are 58, 26, and 19 times [9][12].