Investment Rating - The report initiates coverage with an "Accumulate" rating for the company [9][13]. Core Views - The company is positioned as a leader in high-end titanium alloy technology, focusing on the production of titanium and titanium alloy bars, forgings, and components primarily for high-end equipment in aerospace, marine, and military sectors. The company aims to expand its product offerings into downstream components, particularly in the shipbuilding and military sectors [9][11][29]. - The company is expected to achieve revenue of 808 million yuan in 2024, reflecting a year-on-year growth of 0.91%, and a net profit attributable to shareholders of 152 million yuan, with a year-on-year increase of 3.04% [9][11]. Summary by Sections 1. High-End Titanium Alloy Sector - The company specializes in high-end titanium and titanium alloy materials, being a key R&D and production base in China. It has transitioned from its original business model to focus on high-performance titanium products since 2006 [19][20]. - The company has established partnerships with major military groups, supplying various titanium alloy products for military aircraft and engines, contributing significantly to national defense upgrades [21][29]. 2. Titanium Alloy Performance and Market Demand - Titanium alloys are characterized by low thermal conductivity, excellent high and low-temperature resistance, and strong corrosion resistance, making them suitable for aerospace and marine applications. The demand for titanium alloys in the aerospace sector is expected to remain robust due to increasing equipment penetration rates and reliability requirements [10][39]. 3. Competitive Advantages - The company has developed proprietary technologies for over 20 grades of titanium alloys, achieving breakthroughs in high-strength and high-toughness materials. It is a core supplier for high-end equipment and is expanding its presence in the civil aviation and marine markets [11][29]. - The company is accelerating capacity release, with new projects expected to add 2,800 tons of titanium alloy bar capacity and 200 tons of forgings [11][29]. 4. Financial Performance and Forecast - The company’s revenue has shown steady growth, increasing from 462 million yuan in 2020 to an expected 808 million yuan in 2024, with a compound annual growth rate of 15.04%. The net profit attributable to shareholders is projected to grow significantly during the same period [34][35]. - The report forecasts net profits of 170 million yuan, 240 million yuan, and 330 million yuan for 2025, 2026, and 2027, respectively, with corresponding price-to-earnings ratios of 59, 42, and 30 times [13][12]. 5. Market Recognition and Growth Potential - The market has not fully recognized the company's potential in the marine and civil aviation sectors. The company’s established presence in the aerospace sector is expected to support future growth as new military aircraft and engines are introduced [14][29]. 6. Catalysts for Stock Performance - Potential catalysts for stock performance include unexpected increases in downstream equipment demand and accelerated certification processes for large aircraft [15].

Investment Rating - The report initiates coverage with an "Accumulate" rating for the company [10][12]. Core Views - The company is deeply rooted in the high-end titanium alloy sector, with a diverse layout aimed at new growth opportunities. Its main products include titanium and titanium alloy bars, billets, and components, primarily used in high-end equipment fields such as aviation, aerospace, naval vessels, and weaponry. The company achieved a revenue of 808 million yuan in 2024, reflecting a year-on-year increase of 0.91%, and a net profit attributable to shareholders of 152 million yuan, up 3.04% year-on-year [8][10]. - The performance of titanium alloys is exceptional, with widespread applications across various downstream sectors, maintaining high demand. High-end titanium alloys are characterized by low thermal conductivity, excellent high and low-temperature performance, and strong corrosion resistance, making them suitable for aviation and naval applications. The market for titanium alloys is expected to grow significantly due to increasing demand in aerospace and naval sectors [8][9][10]. Summary by Sections 1. High-End Titanium Alloy Sector - The company focuses on high-end titanium alloys, establishing itself as a leading enterprise in the industry. It has transitioned from its original business model to specialize in high-performance titanium and titanium alloy materials since 2006, with significant investments in production lines and technology [20][21]. - The company has developed a robust product portfolio, with titanium alloy bars accounting for over 80% of its revenue. In 2023, the revenue from titanium bars reached 682 million yuan, contributing significantly to the overall profitability [30][33]. 2. Titanium Alloy Performance and Market Demand - Titanium alloys are recognized for their superior properties and strategic importance, with applications expanding beyond aerospace to include chemical, petroleum, and power industries. In 2024, the chemical and aerospace sectors accounted for 49% and 21% of titanium product applications, respectively [41][42]. - The demand for titanium alloys in the aerospace sector is particularly strong, driven by the increasing use of titanium in military and civilian aircraft. The proportion of titanium used in military aircraft has significantly increased, with advanced models utilizing up to 41% of titanium in their structure [56][59]. 3. Competitive Advantages and Growth Potential - The company possesses three main advantages: leading technology in high-end titanium alloys, a strong supplier position in high-end equipment, and accelerated capacity release. It has established deep relationships with key clients in the aerospace sector and is expanding its presence in the civil aviation and naval markets [9][10][12]. - The company is expected to see a steady increase in net profit, with projections of 170 million yuan in 2025, 240 million yuan in 2026, and 330 million yuan in 2027, indicating a favorable growth trajectory compared to its peers [10][12].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 67.20 CNY, based on a 42x PE ratio for 2025 [2][4]. Core Insights - The company has received the Anhui Provincial Science and Technology Progress Award for its key technology and engineering application results related to the EAST large scientific device, indicating strong technological capabilities [1]. - The company is expected to benefit from a recovery in downstream demand and advancements in nuclear fusion projects, which may lead to synchronized growth across its various business segments [1]. Financial Forecast and Performance - Revenue projections for 2025 and 2026 have been adjusted to 6,028 million CNY and 7,337 million CNY, respectively, reflecting a growth rate of 30.7% and 21.7% [3]. - The adjusted EPS for 2025 is forecasted at 1.60 CNY, with further increases to 1.97 CNY in 2026 and 2.41 CNY in 2027 [2][3]. - The company’s gross margin is expected to improve from 31.9% in 2023 to 35.4% by 2027, indicating enhanced profitability [3]. Business Segments and Innovations - The superconducting materials business is globally leading, with multiple projects achieving bulk supply, including superconducting wire materials for domestic nuclear fusion projects [9]. - Significant breakthroughs in high-performance high-temperature alloy technology have been achieved, enhancing the company's competitive edge in the industry [9]. - The high-end titanium alloy market is expanding, with the company developing new titanium alloy products for various sectors, including marine and nuclear industries [9].