Investment Rating - The report maintains a "Buy" rating for the company [2][5] Core Views - The company has demonstrated significant growth potential, particularly in the functional sugar sector, with a reported revenue of RMB 1.15 billion in 2024, representing a year-on-year increase of 32.64% [4][8] - The gross profit margin has improved, reaching 33.65% in 2024, up 0.92 percentage points year-on-year, and further increasing to 39.74% in Q1 2025, up 5.99 percentage points year-on-year [8][11] - The company is expected to continue its growth trajectory with projected earnings per share (EPS) of RMB 1.05, RMB 1.34, and RMB 1.63 for 2025, 2026, and 2027 respectively, corresponding to price-to-earnings (PE) ratios of 25.8, 20.2, and 16.6 [5][7] Financial Performance Summary - In 2024, the company achieved total revenue of RMB 1,151.65 million, with a net profit of RMB 245.60 million, reflecting a growth rate of 27.26% compared to 2023 [9] - The fourth quarter of 2024 saw a revenue of RMB 331.26 million, a year-on-year increase of 54.46%, with a net profit of RMB 63.01 million, up 21.97% year-on-year [10] - For Q1 2025, the company reported revenue of RMB 313.30 million, a 24.27% increase year-on-year, and a net profit of RMB 81.42 million, up 52.06% year-on-year [11] Growth Drivers - The company is set to benefit from the full production of new projects, including a soluble dietary fiber project and a crystallized sugar project, which are expected to enhance its production capacity and profitability [8][9] - The demand for dietary fibers, prebiotics, and healthy sweeteners is anticipated to drive revenue growth, with dietary fiber revenue expected to grow over 40% in 2024 [8][9] - The company is actively expanding its product portfolio, with plans to launch new products such as isomaltulose and crystallized fructose in 2024, which are expected to contribute to revenue growth [8][9]

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected relative return of over 20% within the next six months [6][17]. Core Insights - The company is experiencing rapid growth in the sugar substitute market, with significant improvements in profitability. Revenue, net profit, and net profit excluding non-recurring items for 2024 are projected to be CNY 1.152 billion, CNY 246 million, and CNY 231 million, respectively, representing year-on-year increases of 32.64%, 27.26%, and 31.72% [1][4]. - The company is benefiting from capacity expansion and increased demand for healthy sweeteners, with Q1 revenue for healthy sweeteners doubling compared to the previous year [1][2]. - The overseas market is showing strong demand, with foreign revenue accounting for nearly 70% in Q1 2025, reflecting a year-on-year increase of 11% [2]. Financial Performance - The company's gross margin and net profit margin for 2024 are projected to be 33.65% and 21.33%, respectively, with improvements attributed to cost reductions and increased production efficiency [3][4]. - The financial forecast indicates that revenue is expected to grow by 33%, 23%, and 20% from 2025 to 2027, reaching CNY 1.53 billion, CNY 1.88 billion, and CNY 2.26 billion, respectively [4][5]. - The projected net profit for 2025 is CNY 335 million, with a year-on-year growth of 36.55% [5][4]. Market Dynamics - The company is expanding its overseas market presence, with foreign revenue projected to reach CNY 698 million in 2024, a year-on-year increase of 58.42% [2]. - The demand for products like allulose sugar is increasing globally, aligning with health trends in various countries [2][4].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price not specified [6][17]. Core Views - The company is experiencing rapid growth in the sugar substitute market, with significant improvements in profitability. Revenue, net profit, and net profit excluding non-recurring items for 2024 are projected to be 1.152 billion, 246 million, and 231 million CNY respectively, representing year-on-year growth of 32.64%, 27.26%, and 31.72% [1]. - The company is benefiting from capacity expansion and strong demand for health-oriented sweeteners, with Q1 revenue from health sweeteners doubling [1][2]. - The overseas market is showing robust demand, with foreign revenue accounting for nearly 70% in Q1 2025, reflecting a year-on-year increase of 11% [2]. Financial Performance Summary - For 2024, the company expects a gross margin of 33.65% and a net profit margin of 21.33%, with improvements in cost management contributing to these figures [3]. - The company’s revenue is projected to grow at a compound annual growth rate (CAGR) of 33% from 2025 to 2027, reaching 1.534 billion, 1.883 billion, and 2.261 billion CNY respectively [4]. - The net profit is expected to grow at a CAGR of 37% from 2025 to 2027, reaching 335 million, 416 million, and 513 million CNY respectively [4]. Market Dynamics - The company is expanding its overseas market presence, with foreign revenue growing significantly due to increasing health trends globally [2]. - The demand for products like allulose is strong, driven by health-conscious consumers [2]. Cost Management - The improvement in gross margin is attributed to reduced operational costs from new production lines and a shift from outsourcing to in-house production of raw materials [3].

Investment Rating - The investment rating for the company is "Outperform the Market" [4][11][28] Core Views - The company achieved a net profit attributable to shareholders of 246 million yuan in 2024, representing a year-on-year growth of 27%. In the first quarter of 2025, the net profit reached 81.4 million yuan, up 52% year-on-year [1][13] - The company’s revenue for 2024 was 1.152 billion yuan, a 32.64% increase compared to the previous year. In Q1 2025, revenue was 313 million yuan, growing 24.27% year-on-year [1][13] - The company is experiencing rapid growth in its dietary fiber and health sweetener segments, particularly with the increasing demand for resistant dextrin and polydextrose in the food and beverage industry [2][21] - The company is actively expanding its production capacity through projects such as the "Functional Sugar Drying Expansion Project" and the "Thailand Health Project," which are expected to enhance profitability in the future [3][26] Financial Performance Summary - In 2024, the company’s gross profit margin was 33.65%, an increase of 0.92 percentage points year-on-year, while the net profit margin was 21.33%, a decrease of 0.90 percentage points [1][13] - For Q1 2025, the gross profit margin improved to 39.74%, up 5.99 percentage points year-on-year, and the net profit margin increased to 25.99%, up 4.75 percentage points year-on-year [1][13] - The company’s revenue projections for 2025-2027 are 1.526 billion yuan, 1.829 billion yuan, and 2.140 billion yuan, respectively, with net profits expected to be 346 million yuan, 431 million yuan, and 503 million yuan [12][28] Business Segments Summary - The company’s main business segments include prebiotics, dietary fibers, health sweeteners, and other starch sugars. In 2024, the prebiotic segment generated 322 million yuan in revenue, a 25.43% increase, while the dietary fiber segment saw revenue of 624 million yuan, up 40.42% [2][21] - The health sweetener segment generated 156 million yuan in revenue, a 13.85% increase, with the contribution of allulose rising to 14.12% of total revenue, marking it as a significant source of income [2][21] - In Q1 2025, the prebiotic segment revenue was 85.8 million yuan, up 17.27%, while the dietary fiber segment revenue was 170 million yuan, up 25.40%. The allulose segment revenue surged to 49.8 million yuan, a remarkable increase of 105.31% [2][21] Future Growth Drivers - The company is investing in a new production base in Thailand, which is expected to enhance its brand, technology development, and market expansion capabilities, ultimately improving profitability and competitiveness [4][26] - The ongoing approval process for allulose in China and the steady growth of the overseas market are anticipated to further boost the company’s revenue and market presence [9][27]

Core Viewpoint - The company reported strong financial performance for 2024 and Q1 2025, with significant revenue and profit growth driven by product expansion and capacity enhancements [1][3]. Financial Performance - In 2024, the company achieved revenue of 1.152 billion yuan, a year-on-year increase of 32.64%, and a net profit attributable to shareholders of 246 million yuan, up 27.26% [1]. - For Q1 2025, revenue reached 313 million yuan, reflecting a year-on-year growth of 24.27%, with a net profit of 81 million yuan, marking a substantial increase of 52.06% [1]. Product Revenue Breakdown - In 2024, the dietary fiber series generated revenue of 624 million yuan, up 40.42%, while the prebiotic series brought in 322 million yuan, a 25.43% increase. The health sweeteners series earned 156 million yuan, growing by 13.85%. However, other starch sugars (alcohols) saw a decline, with revenue of 4 million yuan, down 72.48% [1]. - For Q1 2025, the dietary fiber series revenue was 170 million yuan, up 25.4%, the prebiotic series earned 86 million yuan, a 17.3% increase, and the health sweeteners series saw a remarkable growth of 105.3%, generating 50 million yuan. Other starch sugars (alcohols) achieved 2 million yuan, up 10.3% [2]. Profitability and Cost Management - The company's gross margin for 2024 was 33.65%, with a net profit margin of 21.33%. In Q1 2025, these figures improved to 39.74% and 25.99%, respectively, indicating a significant enhancement in profitability [3]. - The increase in gross margin is attributed to the production chain extension from new projects, a decrease in raw material prices, and the realization of scale efficiencies [3]. Capacity Expansion Projects - The company is actively constructing two major capacity enhancement projects: the functional sugar drying expansion project, expected to be completed by 2025-2026, and the Thailand health food raw material smart factory project, anticipated to start construction in Q2-Q3 2025 [4]. - The Thailand project aims to produce various sugar products, which will help reduce production costs and mitigate potential trade risks due to tariffs [4]. Market Opportunities - The domestic approval of D-allohexose as a new food raw material is expected soon, providing a significant market opportunity for the company's health sweeteners [5]. - The "Healthy China Action" initiative includes functional sweeteners in its support directory, with over 500 million yuan in subsidies planned for 2025, further bolstering the market for alternative sweeteners [5]. Profit Forecast - The company is projected to achieve net profits of 341 million yuan, 457 million yuan, and 624 million yuan for 2025-2027, representing year-on-year growth rates of 39%, 34%, and 37%, respectively [5].

Investment Rating - The report assigns a "Buy" rating for the company with a target price of 26 CNY, based on a relative valuation method, corresponding to a PE of 25X for 2025 [6]. Core Viewpoints - The company is a leading player in functional sugars, with accelerated capacity expansion driving high growth. It has established itself as a top supplier of functional ingredients in China, focusing on prebiotics, dietary fibers, and healthy sweeteners. The company is expected to achieve a revenue CAGR of 22% and a net profit CAGR of 25% from 2019 to 2024 [1][3]. Summary by Sections 1. Functional Sugar Leadership and Capacity Expansion - The company has diversified its product matrix to meet health demands, with a focus on prebiotics, dietary fibers, and healthy sweeteners. Its revenue from prebiotics, dietary fibers, and healthy sweeteners accounted for 29%, 54%, and 13% respectively in Q1-Q3 2024 [18][19]. - The company has a stable shareholding structure and experienced management team, with the chairman holding 47.36% of shares, ensuring strong operational control [21][24]. - The company maintains a strong profitability position within the industry, with new production lines expected to enhance profit elasticity in 2025 [26]. 2. Emerging Industry Potential and Competitive Barriers - The dietary fiber industry is experiencing robust growth, with global and Chinese revenues reaching 514 million and 129 million USD in 2023, respectively, and projected to grow significantly by 2030 [2][34]. - The company is positioned to benefit from the high technical barriers in the high-end product segment, particularly in resistant dextrin, which has a market share of 18% in China [40][46]. 3. Performance Growth from Capacity Expansion and Stable Demand - The company anticipates revenue growth from three main areas: increased proportion of high-margin products, continuous capacity expansion, and strong customer stickiness [3][32]. - The company expects a revenue increase of 33% in 2024, reaching 1.15 billion CNY, with net profit projected to grow by 30% to 250 million CNY [3][5]. 4. Financial Forecast - The company’s financial projections indicate a revenue increase to 1.15 billion CNY in 2024, with net profit reaching 250 million CNY, and further growth expected in subsequent years [5][26].