Group 1 - The mutual recognition arrangement between the General Administration of Customs of China and the General Customs Administration of Mongolia for AEO (Authorized Economic Operator) enterprises was officially implemented on June 1, enhancing trade facilitation between the two countries [1] - AEO enterprises will benefit from lower document review rates, reduced import inspection rates, priority inspection for goods requiring physical checks, and designated customs liaison officers to assist with customs issues [1] - Zhejiang AnDe Electric Co., Ltd., a high-end kitchen appliance manufacturer, reported a 150% year-on-year increase in exports to Mongolia, amounting to 1.99 million yuan in 2024, attributing this growth to the AEO certification and the new mutual recognition arrangement [1] Group 2 - Zhejiang Jiuzhou Pharmaceutical Co., Ltd. expressed optimism about the AEO mutual recognition arrangement, highlighting its alignment with the company's strategic goals to enhance product competitiveness and reduce international logistics costs [2] - In the first four months of this year, Zhejiang Province's trade with Mongolia reached 520 million yuan, a 39.3% increase year-on-year, with AEO enterprises in Hangzhou contributing 25.43 million yuan, a 59.6% increase [2] - The Hangzhou Customs plans to strengthen the cultivation of AEO enterprises, prioritizing certification for "Zhejiang Export Brand" companies and key industry chain enterprises to enhance their competitiveness and modern management systems [2] Group 3 - China has signed AEO mutual recognition agreements with 31 economies globally, covering 57 countries and regions, including 38 countries involved in the Belt and Road Initiative, leading the world in both the number of agreements and participating countries [3]

Investment Rating - The report assigns an "Outperform" rating to the company with a target price of RMB 28.39 based on a 17x PE for 2025 [4][12]. Core Views - The company is expected to achieve stable revenue growth, with 2024 revenue projected at RMB 5.89 billion (+10.12%) and net profit attributable to shareholders at RMB 0.78 billion (+27.61%) [4][12]. - The veterinary medicine segment is anticipated to contribute significantly to revenue growth, with a projected revenue of RMB 2.02 billion in 2024 (+10.0%) [4][13]. - The company is enhancing its global operations, with products sold in 115 countries and regions, establishing a strong position in the global pharmaceutical manufacturing industry [4][14]. Financial Summary - Revenue and net profit forecasts for 2024 and 2025 are as follows: - 2024 Revenue: RMB 5.89 billion (+10.12%) - 2024 Net Profit: RMB 0.78 billion (+27.61%) - 2025 Revenue: RMB 6.60 billion (+12.1%) - 2025 Net Profit: RMB 0.93 billion (+19.5%) [3][4][12]. - Earnings per share (EPS) are projected to be RMB 1.67 in 2025, RMB 2.01 in 2026, and RMB 2.36 in 2027 [4][12]. Business Segments - The pharmaceutical raw materials segment is benefiting from high demand for macrolide antibiotics, with a projected revenue of RMB 2.48 billion in 2024 (+11.7%) and a gross profit margin of 28.4% [4][13]. - The veterinary medicine business is expanding, with significant sales growth expected due to improved market conditions and product certifications [4][13][14]. Global Operations - The company is focusing on globalization and integration, with over 70 active pharmaceutical ingredients and intermediates expected to be produced and sold in 2024 [4][14]. - The company has established sales channels in multiple countries, enhancing its global reach and operational capabilities [4][14].

Investment Rating - The report assigns an "Outperform" rating to the company with a target price of 28.39 RMB, based on a 17x PE for 2025 [4][12]. Core Insights - The company is expected to achieve stable revenue growth, with 2024 revenue projected at 5.89 billion RMB (+10.12%) and net profit attributable to shareholders at 0.78 billion RMB (+27.61%) [4][12]. - The veterinary medicine segment is anticipated to contribute significantly to revenue, with a projected 2024 revenue of 2.02 billion RMB (+10.0%) [13][14]. - The company is enhancing its global operations, with products sold in 115 countries and regions, establishing a strong position in the global pharmaceutical manufacturing industry [14] Financial Summary - Revenue and net profit forecasts for 2024-2027 are as follows: - 2024 Revenue: 5.89 billion RMB (+10.1%) - 2024 Net Profit: 0.78 billion RMB (+27.6%) - 2025 Revenue: 6.60 billion RMB (+12.1%) - 2025 Net Profit: 0.93 billion RMB (+19.5%) - 2026 Revenue: 7.52 billion RMB (+14.0%) - 2026 Net Profit: 1.12 billion RMB (+20.0%) - 2027 Revenue: 8.61 billion RMB (+14.4%) - 2027 Net Profit: 1.32 billion RMB (+17.8%) [3][4][12]. Business Segments - The pharmaceutical raw materials segment is projected to generate 2.48 billion RMB in 2024, benefiting from high demand for macrolide antibiotics [13]. - The veterinary medicine business is expanding, with significant sales growth and increased capacity utilization for key products [13][14]. Global Operations - The company is focusing on globalization, with over 70 active pharmaceutical ingredients and intermediates expected to be produced and sold in 2024 [14]. - Established sales channels in various countries, including India, Netherlands, and Spain, enhancing its international market presence [14].