Investment Rating - The investment rating for the company is "Accumulate" (maintained) [4] Core Views - The injection of the Shizhu Garden tungsten mine is expected to significantly enhance the company's profitability [4] - The company operates as a management platform for the tungsten industry under China Minmetals, managing a complete tungsten industry chain from mining to smelting, processing, and trading [6][4] - The company has achieved a notable increase in revenue and net profit, with a projected growth in net profit from 1.08 billion RMB in 2025 to 1.26 billion RMB in 2027 [4][6] Financial Summary - For 2024, the company reported a revenue of 14.743 billion RMB, a year-on-year increase of 7.8%, and a net profit of 939 million RMB, up 17.5% year-on-year [6] - The projected revenues for 2025, 2026, and 2027 are 15.523 billion RMB, 16.462 billion RMB, and 17.546 billion RMB respectively, with corresponding net profits of 1.08 billion RMB, 1.175 billion RMB, and 1.264 billion RMB [4][7] - The company's gross profit margin for 2024 was 22.1%, with a total gross profit of 3.25 billion RMB [6][7] Market Performance - The acquisition of Shizhu Garden Company, which owns the largest single tungsten mine currently in production, is expected to enhance the company's asset quality and profitability [6][4] - The company has optimized its product structure, focusing on high-value-added products, and has achieved a significant market share in the CNC blade production [6][4] Profitability Forecast - The company is expected to maintain a steady growth trajectory, with projected earnings per share (EPS) of 0.47 RMB in 2025, 0.52 RMB in 2026, and 0.55 RMB in 2027 [4][7] - The return on equity (ROE) is projected to be 6.44% in 2025, gradually increasing to 6.78% by 2027 [4][7]

Core Insights - The company achieved a revenue of 14.743 billion yuan in 2024, representing a year-on-year growth of 7.8% [1] - The acquisition of Hunan Shizhu Garden Nonferrous Metals Co., Ltd. significantly enhanced the company's performance, contributing 3.571 billion yuan in revenue and 705 million yuan in net profit in 2024 [2] - The overall gross margin for 2024 was 22.07%, an increase of 0.85 percentage points year-on-year, with specific product margins showing varied performance [2] - The company reported a net profit attributable to shareholders of 939 million yuan in 2024, a year-on-year increase of 17.47% [3] - The company’s asset-liability ratio decreased to 52.40% in 2024, down by 2.51 percentage points [4] Revenue Breakdown - Revenue from cutting tools and tools was 3.189 billion yuan, up 4.31% year-on-year, driven by market expansion [1] - Revenue from hard alloys was 3.356 billion yuan, down 2.19% year-on-year [1] - Revenue from refractory metals was 2.426 billion yuan, up 11.68% year-on-year [1] - Revenue from powder products was 4.573 billion yuan, up 32.22% year-on-year [1] Profitability Analysis - The gross margin for blade products was 33.30%, down 1.72 percentage points year-on-year [2] - The gross margin for alloy products was 18.63%, down 0.51 percentage points year-on-year [2] - The gross margin for refractory metals was 10.33%, down 2.68 percentage points year-on-year [2] - The gross margin for powder products was 23.61%, up 5.09 percentage points year-on-year [2] Expense and Cash Flow - The operating expense ratio for 2024 was 13.42%, an increase of 1.12 percentage points year-on-year [3] - The company’s cash flow from operations improved, with a net cash inflow of 900 million yuan, an increase of 750 million yuan year-on-year [3] - The investment cash flow was negative at -850 million yuan, reflecting increased spending on technological upgrades and land acquisition [3] Future Outlook - The company is expected to achieve net profits of 1.094 billion yuan, 1.323 billion yuan, and 1.476 billion yuan from 2025 to 2027 [4]

Investment Rating - The report maintains a "Strong Buy" rating for the company [3]. Core Views - The company has achieved stable revenue growth, with the consolidation of Shizhu Garden significantly enhancing its performance [2][6]. - The company focuses on integrated development across the tungsten industry chain, leading to both revenue and profit growth [6]. Financial Data and Valuation - Total revenue for 2023 is projected at 12,736 million yuan, with a year-on-year decrease of 3%. Revenue is expected to grow to 14,743 million yuan in 2024, reflecting a 16% increase [2][19]. - Operating profit is forecasted to be 637 million yuan in 2023, with a significant increase to 1,139 million yuan in 2024, representing a 79% growth [2][19]. - Net profit attributable to shareholders is expected to be 485 million yuan in 2023, increasing to 939 million yuan in 2024, a 94% rise [2][19]. - Earnings per share (EPS) is projected to rise from 0.21 yuan in 2023 to 0.41 yuan in 2024 [2][19]. - The company’s price-to-earnings (PE) ratio is expected to decrease from 44.9 in 2023 to 23.2 in 2024, indicating improved valuation [2][19]. Revenue Breakdown - In 2024, the company achieved a revenue of 14,743 million yuan, with a year-on-year increase of 7.8%. The revenue from cutting tools and tools was 3,189 million yuan, up 4.31% [6]. - The revenue from hard alloy products was 3,356 million yuan, down 2.19%, while refractory metals generated 2,426 million yuan, up 11.68% [6]. - Powder products saw a revenue increase of 32.22%, reaching 4,573 million yuan [6]. Margin Analysis - The overall gross margin for 2024 is 22.07%, an increase of 0.85 percentage points year-on-year. The gross margin for blade products is 33.30%, down 1.72 percentage points [6]. - The gross margin for powder products improved by 5.09 percentage points to 23.61% [6]. Cash Flow and Debt Management - The company reported a net operating cash flow of 900 million yuan in 2024, a significant increase of 750 million yuan year-on-year [6]. - The debt ratio for 2024 is projected at 52.40%, a decrease of 2.51 percentage points from the previous year [6][19]. Future Profit Projections - The company is expected to achieve net profits of 1,094 million yuan, 1,323 million yuan, and 1,476 million yuan for the years 2025, 2026, and 2027 respectively [6].