Core Viewpoint - The company's 1H25 performance met expectations, with revenue growth driven by stable pig farming production and cost improvements, alongside significant reduction in fresh food business losses [1][2]. Group 1: Financial Performance - 1H25 revenue increased by 19.8% year-on-year to 8.963 billion yuan, with net profit before and after fair value adjustments of biological assets at 198 million and 317 million yuan, respectively [1]. - Fresh pork revenue rose by 21% to 2.54 billion yuan, with brand revenue share increasing by 4.5 percentage points to 31.2% [2]. - Feed business revenue decreased by 3.7% to 3.127 billion yuan, while sales volume increased by 1.6% to 958,000 tons [2]. Group 2: Operational Developments - Pig farming showed high-quality growth with a revenue increase of 68.7% to 4.494 billion yuan, driven by an 83% increase in slaughter volume to 2.899 million heads [1][2]. - The company is expanding its "company + farmer" model, contributing to growth in slaughter volume [1]. - The company aims to support a slaughter volume of 5-6 million heads in 2025 through enhanced operational efficiency and a focus on a light-asset farming model [3]. Group 3: Cost Management and Financial Health - Continuous improvement in farming costs is noted, with estimated total costs for Q2 2025 at 13.0-13.5 yuan per kilogram [2][3]. - The company's balance sheet remains robust, with a debt-to-asset ratio of 53.2% at the end of 1H25, reflecting a slight increase due to the acquisition of COFCO Jia Hua [3]. Group 4: Future Outlook and Valuation - The company maintains net profit forecasts of 760 million and 1.15 billion yuan for 2025 and 2026, respectively [3]. - The current stock price corresponds to 10 and 7 times P/E for 2025 and 2026, with a target price raised by 39% to 2.5 HKD, indicating a potential upside of 33% [3].

Core Viewpoint - The report maintains a positive outlook on COFCO Joycome (01610), projecting net profits of 760 million and 1.15 billion yuan for 2025 and 2026 respectively, with a target price increase of 39% to HKD 2.5, indicating a potential upside of 33% [1] Group 1: Pig Farming and Fresh Meat Business - The pig farming segment is experiencing high-quality growth, with revenue for 1H25 increasing by 68.7% to 4.494 billion yuan, driven by an 83% increase in slaughter volume to 2.899 million heads [2] - The fresh pork segment has shown significant improvement, with revenue rising by 21% to 2.54 billion yuan, and brand revenue share increasing by 4.5 percentage points to 31.2% [2] - The sales volume of branded boxed pork surged by 47% to 27.79 million boxes, while sales of flaxseed pork increased by 123% [2] Group 2: Cost Management and Financial Health - The company has successfully reduced farming costs, with total costs estimated at 13.0-13.5 yuan per kilogram in 2Q25, and further optimization expected in 2H25 due to improved breeding efficiency and the "company + farmer" model [3] - The financial position remains robust, with a debt-to-asset ratio of 53.2% at the end of 1H25, reflecting a slight increase due to the acquisition of COFCO Jiahua [3] Group 3: Strategic Initiatives and Future Outlook - The company is enhancing its light-asset model to increase the flexibility of pig farming output, with a target slaughter volume of 5-6 million heads for 2025 [4] - The brand strategy is yielding results, with efforts to improve product quality and expand sales channels, which is expected to gradually enhance profit contributions [4]

Core Viewpoint - The report from CICC maintains a positive outlook on COFCO Joycome (01610), projecting net profits of 760 million and 1.15 billion yuan for 2025 and 2026 respectively, with a target price increase of 39% to 2.5 HKD, indicating a potential upside of 33% [1] Group 1: Pig Farming and Fresh Meat Business - The pig farming segment is experiencing high-quality growth, with a 68.7% year-on-year revenue increase to 4.494 billion yuan in 1H25, driven by an 83% increase in slaughter volume to 2.899 million heads [2] - The fresh pork segment shows significant improvement, with revenue rising 21% year-on-year to 2.54 billion yuan in 1H25, and brand revenue share increasing by 4.5 percentage points to 31.2% [2] - The sales volume of branded boxed pork surged by 47% to 27.79 million boxes, while sales of flaxseed pork increased by 123% year-on-year [2] Group 2: Cost Management and Financial Health - The company is effectively reducing farming costs, with total costs projected at 13.0-13.5 yuan per kilogram in Q2 2025, and further optimization expected in H2 2025 due to improved breeding systems and operational efficiencies [3] - The financial position remains robust, with a debt-to-asset ratio of 53.2% at the end of 1H25, reflecting a slight increase due to the acquisition of COFCO Jiahua [3] Group 3: Strategic Initiatives and Future Outlook - The company is exploring a light-asset farming model, which is expected to enhance the elasticity of slaughter volumes, with projections of 5-6 million heads for 2025 [4] - The brand strategy is yielding results, with efforts to enhance product quality and expand sales channels, indicating a gradual increase in profit contributions from the fresh meat segment [4]

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company reported a revenue of 1146.01 billion CNY in 2024, a decrease of 1.31% year-on-year, while the net profit attributable to shareholders was 45.04 billion CNY, an increase of 64.30% year-on-year [2][3] - The feed business showed resilience with a market share increase, while the aquaculture segment turned profitable [3][4] - The company is focusing on a light-asset breeding model and has made significant progress in international markets, with overseas feed sales growing by approximately 40% [3][4] Summary by Sections Financial Performance - In 2024, the company achieved a total revenue of 1146.01 billion CNY, with a year-on-year decline of 1.31%. The feed segment generated 957.75 billion CNY, down 4.82%, while the aquaculture segment saw revenue of 188.26 billion CNY, up 21.52% [2][3] - For Q1 2025, the company reported a revenue of 256.29 billion CNY, a year-on-year increase of 10.60%, and a net profit of 12.82 billion CNY, up 48.99% year-on-year [2] Business Segments - The feed business accounted for 83.57% of total revenue, with a gross margin of 9.94%, an increase of 1.12 percentage points year-on-year. The aquaculture business contributed 16.43% to total revenue, with a gross margin of 18.28%, up 12.05 percentage points [3] - The company sold 26.52 million tons of feed in 2024, a 9% increase year-on-year, with significant growth in poultry and aquaculture feed sales [3] Growth Strategy - The company is implementing a strategy that includes partnerships with large-scale farmers and food companies to expand market share. The international strategy has led to a notable increase in overseas sales, particularly in Vietnam, Indonesia, and Egypt [3][4] - The aquaculture segment has improved significantly, with the company focusing on shrimp and other specialty aquatic products, leading to a reduction in production costs [4] Profitability Forecast - The company expects revenue growth to continue, with projected revenues of 1288.84 billion CNY in 2025 and 1453.02 billion CNY in 2026. The net profit is forecasted to reach 50.98 billion CNY in 2025 and 55.78 billion CNY in 2026 [5][6] - The earnings per share (EPS) are projected to be 3.06 CNY in 2025 and 3.35 CNY in 2026, with a price-to-earnings (PE) ratio of 17 for 2025 [6][8]