Core Viewpoint - Hubei Jianghan New Materials Co., Ltd. reported a decline in revenue and net profit for the year 2024, attributed to global economic downturn and falling product prices, despite an increase in sales volume of functional silane coupling agents. Financial Performance - The company achieved operating revenue of 2.216 billion yuan, a decrease of 2.69% year-on-year [6][24]. - Net profit was 602 million yuan, down 8.03% compared to the previous year [6][24]. - The net cash flow from operating activities was 533 million yuan, a decline of 25.45% year-on-year [6][31]. Market and Industry Conditions - The functional silane market is facing increased competition with many new entrants, leading to price declines despite growing demand [6][7]. - The company successfully developed 141 new domestic customers and 23 international customers, indicating a strong market expansion effort [7]. Operational Highlights - The company launched one new product and completed trials for several others, focusing on market-driven R&D [8][9]. - Production efficiency improvements were made through process upgrades, resulting in a significant reduction in waste and energy consumption [10][11]. Governance and Compliance - The company adhered to legal and regulatory requirements, ensuring proper governance and internal controls [14][19]. - The board of directors held nine meetings and executed all resolutions effectively during the reporting period [16][19]. Environmental and Safety Initiatives - The company implemented various safety and environmental measures, achieving recognition as a "green factory" and reducing environmental costs significantly [13][12].

Investment Rating - The investment rating for the company is "Buy" and it is maintained [4][35]. Core Viewpoints - The company reported a revenue of 2.216 billion yuan in 2024, a year-on-year decrease of 2.69%, and a net profit attributable to shareholders of 602 million yuan, down 8.03% year-on-year [1][9]. - The decline in revenue is primarily attributed to the drop in market prices for functional silanes, despite an increase in sales volume due to capacity expansion from investment projects [2][11]. - The company maintains a high cash dividend payout ratio of 61.67% for 2024, reflecting its commitment to returning value to shareholders [1][9]. Financial Performance Summary - In 2024, the company achieved a gross profit of 761 million yuan, a decrease of 94 million yuan year-on-year, with a comprehensive gross margin of 34.3%, down 3.2 percentage points year-on-year [22]. - The first quarter of 2025 saw a revenue of 492 million yuan, a year-on-year decline of 16.20%, and a net profit of 97 million yuan, down 37.39% year-on-year [10][22]. - The company’s cost management remains strong, with a low expense ratio of 3.8% in 2024 and 2.9% in the first quarter of 2025 [29]. Business Development and Capacity Expansion - The company is investing 1 billion yuan in a comprehensive silicon-based new materials project, aiming to achieve an annual production capacity of 182,000 tons of functional silanes by the end of 2026 [3][33]. - A new project for functional new materials silicon-based precursors is being initiated with an investment of 430 million yuan, expected to produce 10,000 tons of optical fiber-grade silicon tetrachloride and 5,000 tons of electronic-grade ethyl silicate by October 2027 [3][34]. Profit Forecast and Valuation - The projected net profits for the company from 2025 to 2027 are estimated to be 562 million yuan, 640 million yuan, and 731 million yuan respectively [35].