Investment Rating - The report adjusts the investment rating to "Recommendation" for the company, with a target price of 15.3 CNY, reflecting a 30 times PE for 2025 [1][7]. Core Views - The company's main business is gradually recovering, with significant performance in the pet business. The report predicts a net profit of 177 million CNY for 2025 and 211 million CNY for 2026, with an EPS of 0.51 CNY and 0.61 CNY respectively [1][7]. Financial Performance Summary - In 2024, the company achieved a revenue of 1,043 million CNY, a year-on-year decrease of 16.77%, and a net profit of 93 million CNY, down 46.82%. In Q1 2025, revenue was 279 million CNY, up 18.32%, with a net profit of 53 million CNY, up 93.75% [1][3]. - The company’s revenue breakdown for 2024 shows a decline in pig vaccines by 22.58% to 336 million CNY, while poultry vaccines increased by 3.31% to 429 million CNY. The pet business saw a remarkable growth of 125.16%, totaling 46.21 million CNY [1][7]. - The gross margin for 2024 was 61.09%, with a slight increase in poultry vaccines' margin, while the net profit margin in Q1 2025 improved to 18.99%, up 7.39 percentage points year-on-year [1][7]. Business Segment Analysis - The report highlights that the pig vaccine segment is under pressure, but the poultry vaccine segment is accelerating. The pet business is performing exceptionally well, with significant contributions from new products like the cat trivalent vaccine [1][7]. - The company has maintained effective cost control, with a reduction in sales, management, and R&D expense ratios in Q1 2025 compared to the previous year [1][7]. Research and Development - The company continues to invest in R&D, enhancing its product matrix with new vaccines and medications, which are expected to help combat industry competition and drive growth [1][7].

Core Viewpoint - The company reported a decline in revenue and net profit for 2024, but showed growth in Q1 2025, particularly in the pet business, indicating a potential recovery and diversification strategy [1][2]. Financial Performance - For 2024, the company achieved revenue of 1.043 billion, a year-on-year decrease of 16.77%, and a net profit of 92.81 million, down 46.82% [1]. - In Q1 2025, revenue reached 279 million, a year-on-year increase of 18.32%, with a net profit of 52.91 million, up 93.75% [1]. Segment Analysis - In 2024, revenue from pig vaccines was 336 million, down 22.58%, while poultry vaccines generated 429 million, up 3.31% [2]. - The pet business showed significant growth, with total revenue of 46.21 million in 2024, up 125.16%, driven by strong performance in pet healthcare products [2]. Cost Management - The company maintained a gross margin of 61.09% in 2024, with a slight increase year-on-year, while Q1 2025 saw a gross margin of 59.71%, reflecting effective cost control despite challenges in the pig vaccine segment [3]. - In Q1 2025, the company reported a net profit margin of 18.99%, an increase of 7.39 percentage points year-on-year, indicating improved profitability [3]. R&D and Innovation - The company has been focusing on R&D, obtaining new veterinary drug certificates for several important products, which may help counteract industry competition [4]. - Ongoing product development includes vaccines for various diseases, positioning the company to enhance its market presence and support the livestock sector [4]. Investment Outlook - The company is expected to gradually recover in its core business while the pet segment continues to grow, with projected net profits of 177 million in 2025 and 211 million in 2026 [4].