Core Viewpoint - The company is primarily engaged in the maritime transportation of bulk liquid hazardous goods, including liquid chemicals, refined oil, and liquefied petroleum gas, and aims to become a leading comprehensive service provider in the chemical supply chain both internationally and domestically [2]. Group 1 - The company currently operates chemical tankers and has not yet entered the liquefied natural gas (LNG) transportation sector due to the need for specialized vessels and significant investment per ship [2]. - LNG transportation is identified as a strategic development direction for the company, indicating future potential expansion into this market [2]. - The company is closely monitoring market dynamics in energy transportation and plans to advance related strategies based on business development and market opportunities [2].

Core Viewpoint - The domestic chemical shipping market is experiencing a decline in freight rates, while the global chemical shipping market is at historically high levels but is beginning to adjust downwards. The performance of Xingtong Co. is mixed, with strong domestic margins but potential pressure from external market conditions [1][2][4]. Group 1: Domestic Chemical Shipping Market - The demand growth for domestic chemical shipping is slowing, leading to freight rates at historically low levels. In 2024, the domestic chemical shipping market is expected to see a 5% decline in freight rates [1]. - Xingtong Co. achieved a domestic business gross margin of 40.6% in 2024, up from 36% in 2023, likely due to long-term contracts with major clients [1]. Group 2: Global Chemical Shipping Market - In 2024, global chemical shipping rates and prices for 20,000 DWT chemical tankers are at historically high levels but are starting to adjust downwards in the second half of the year [2]. - The global chemical shipping capacity is projected to grow by 4.9% and 5.7% in 2025-26, which may exert pressure on future freight rates [2]. Group 3: Xingtong Co. Performance - Xingtong Co.'s shipping capacity grew by 48% in 2023 and is expected to grow by 12% in 2024, driving revenue growth of 58% and 22%, respectively, and net profit growth of 22% and 39% [3]. - The company plans to introduce two 13,000 DWT dual-purpose stainless steel chemical tankers in 2025, with at least 12 additional foreign trade stainless steel chemical tankers expected to be operational by 2027, enhancing revenue and profit potential [3]. Group 4: Profit Forecast Adjustments - The profit forecast for Xingtong Co. has been adjusted downward due to the expected decline in domestic and foreign hazardous chemical shipping rates, with the 2025 net profit estimate revised to 406 million yuan from 524 million yuan [4]. - The company maintains a "buy" rating despite the adjustments, with net profit forecasts for 2026 and 2027 set at 482 million yuan and 529 million yuan, respectively [4].

Investment Rating - The investment rating for the company is "Buy" [6][4]. Core Views - The domestic chemical shipping market is experiencing a decline in freight rates, with a projected decrease of 5% in 2024. However, the company's domestic business gross margin is expected to improve to 40.6% from 36% in 2023, attributed to long-term contracts with major clients [1][4]. - Global chemical shipping rates are at historically high levels but are expected to start declining in the second half of 2024. The company's foreign business gross margin is projected at 29% for 2024, which may be impacted by falling freight rates [2][4]. - The company's shipping capacity is expected to grow significantly, with a 48% increase in 2023 and a 12% increase in 2024, leading to revenue growth of 58% and 22% respectively, and net profit growth of 22% and 39% [3][4]. Financial Projections - The company's revenue is projected to reach 1,858.22 million yuan in 2025, with a growth rate of 22.68%. The net profit attributable to the parent company is expected to be 405.88 million yuan, reflecting a growth rate of 15.83% [5][22]. - The company's EBITDA is forecasted to be 783.00 million yuan in 2025, with a corresponding increase in net profit margins [5][22]. - The company maintains a strong financial position with a projected net profit of 4.06 billion yuan for 2025, down from an earlier estimate of 5.24 billion yuan, while introducing new profit forecasts for 2026 and 2027 [4][22]. Market Context - The domestic chemical shipping market is nearing a supply-demand inflection point, with some major shipowners shifting capacity to foreign trade routes due to declining domestic rates [1][2]. - The global chemical shipping capacity is expected to grow at rates of 4.9% and 5.7% in 2025-26, which may exert pressure on future freight rates [2][16].