Core Viewpoint - Tongkun Co., Ltd. reported a decrease in revenue for the first half of 2025, with a total revenue of 44.158 billion yuan, down 8.41% year-on-year, while net profit attributable to shareholders increased by 2.93% to 1.097 billion yuan [1] Group 1: Financial Performance - In Q2 2025, the company achieved revenue of 24.738 billion yuan, a year-on-year decrease of 8.73%, but a quarter-on-quarter increase of 27.38% [1] - The net profit for Q2 2025 was 486 million yuan, showing a slight year-on-year increase of 0.04% but a quarter-on-quarter decrease of 20.54% [1] Group 2: Product Performance - The main revenue contributors were polyester filament and purified terephthalic acid (PTA), with revenues of 37.932 billion yuan and 3.521 billion yuan, respectively, accounting for 86% and 8% of total revenue [1] - Production and sales volumes for key products were as follows: POY (4.8696 million tons produced, 4.3796 million tons sold), FDY (1.0877 million tons produced, 1.0295 million tons sold), DTY (585.6 thousand tons produced, 543.5 thousand tons sold), and PTA (767.5 thousand tons produced, 825.1 thousand tons sold) [1] - Price changes for key products were: POY at 6,160.30 yuan/ton (-9.99% YoY), FDY at 6,464.69 yuan/ton (-15.90% YoY), DTY at 7,688.11 yuan/ton (-9.07% YoY), and PTA at 4,267.54 yuan/ton (-19.11% YoY) [1] Group 3: Company Background and Industry Position - Tongkun Co., Ltd. is the largest polyester filament producer globally, with a comprehensive product range including various types of polyester filament [2] - The company has a strong market position, ranking 34th among China's top 500 private enterprises and 25th among China's top 500 private manufacturing enterprises in 2025 [2] Group 4: Production Capacity and Supply Chain - As of mid-2025, the company has a total of 13 million tons of polymerization capacity and 13.5 million tons of filament capacity, leading the industry in filament capacity and output [3] - The company has established multiple production bases across China, ensuring a robust supply chain, with PTA production capacity of 10.2 million tons, achieving self-sufficiency in raw materials [3] Group 5: Profitability Forecast - The company is expected to maintain a compound annual growth rate (CAGR) of 40.53% in net profit attributable to shareholders over the next three years, with a target price of 18.00 yuan based on a 20x PE ratio for 2025 [3]

Investment Rating - The investment rating for Tongkun Co., Ltd. is "Buy" (maintained) [1] Core Views - The Q2 performance of the company met expectations, and there is optimism regarding the recovery of long filament profitability. The company reported a H1 2025 revenue of 44.158 billion yuan, a year-on-year decrease of 8.41%, with a net profit attributable to shareholders of 1.097 billion yuan, a year-on-year increase of 2.93% [5][6] - The company maintains its profit forecast for 2025-2027, expecting net profits of 2.541 billion yuan, 3.648 billion yuan, and 4.274 billion yuan respectively, with corresponding EPS of 1.06, 1.52, and 1.78 yuan. The current stock price corresponds to P/E ratios of 13.6, 9.5, and 8.1 times for the respective years [5][8] Summary by Sections Financial Performance - In H1 2025, the company produced and sold 6.54 million tons and 5.95 million tons of polyester filament respectively, with a production and sales rate of 91.0%. In Q2, production and sales were 3.25 million tons and 3.45 million tons, showing a quarter-on-quarter change of -1.3% and +38.2% respectively [6] - The gross profit margin and net profit margin for H1 2025 were 6.76% and 2.50%, while for Q2 2025, they were 6.01% and 1.98%, reflecting a quarter-on-quarter decrease of 1.70 percentage points and 1.18 percentage points respectively [6] - The average price difference for polyester filament POY in Q2 2025 was 1,180 yuan/ton, a decrease of 11.27% from Q1 2025. Conversely, the PTA price difference increased to 248 yuan/ton, up 72.01% from Q1 2025, indicating improved PTA profitability [6] Market Outlook - The inventory levels for polyester filament products are currently low, with POY, FDY, and DTY having inventory days of 16, 18.7, and 25.4 days respectively. The upcoming demand peak in September and October is expected to enhance profitability for filament products [7] - The long filament industry has passed its peak production phase, and future capacity growth is expected to slow down. The industry is characterized by high concentration, which may enhance pricing power and synergy effects for leading companies, supporting long-term profitability recovery [7]

Investment Rating - The industry rating is maintained at "Overweight" [5][6] Core Insights - Recent inventory of polyester filament has decreased, and the demand peak season is approaching. In the first seven months of 2025, the production of polyester filament increased by 6.5% year-on-year, with a July operating rate of 89.2%. As of August 21, the inventory days for POY, DTY, and FDY were 13.8, 27.8, and 22.7 days respectively, showing a decline of 2.3, 0.4, and 0.6 days compared to the previous week. The apparent consumption of polyester filament grew approximately 6.0% year-on-year, and export volume increased by 13.8% [5][9]. The profitability margins for POY, DTY, and FDY against their main raw materials were 1149, 2324, and 1424 CNY/ton respectively. The industry is expected to improve as the "Golden September and Silver October" demand season approaches [5][6]. Summary by Sections Polyester Filament Industry Data - Recent inventory of polyester filament has decreased. In the first seven months of 2025, the production increased by 6.5% year-on-year, with a July operating rate of 89.2%. As of August 21, the inventory days for POY, DTY, and FDY were 13.8, 27.8, and 22.7 days respectively, showing a decline compared to the previous week. The apparent consumption increased by approximately 6.0% year-on-year, and export volume rose by 13.8% [9][5]. Investment Recommendations - The recent decrease in polyester filament inventory and the upcoming demand peak season are expected to enhance the industry's outlook. In the medium to long term, the industry has initiated high-quality development initiatives to prevent "involution" competition. Companies are likely to improve profitability through rational expansion on the supply side and industry self-discipline. The industry rating remains "Overweight" [6][33].

Investment Rating - The report maintains a "Buy" rating for the company [2] Core Views - The company achieved a significant increase in revenue and net profit in 2024, with operating income reaching 101.31 billion yuan, up 22.6% year-on-year, and net profit attributable to shareholders at 1.20 billion yuan, up 50.8% year-on-year [6] - The company is the largest polyester filament manufacturer in China and is expected to benefit from industry recovery and new capacity investments in regions like Fujian and Anhui [9] Financial Performance Summary - In Q4 2024, the company reported a revenue of 25.26 billion yuan, a year-on-year increase of 20.9%, and a net profit of 195 million yuan, up 283.2% year-on-year [6] - For Q1 2025, the company recorded a revenue of 19.42 billion yuan, down 8.0% year-on-year, but net profit increased by 5.4% year-on-year to 611 million yuan [6] - The company’s polyester production capacity is approximately 13 million tons per year, and it plans to add two new production lines in 2025, which are expected to enhance profitability [6][9] Industry Outlook - The growth rate of polyester filament production capacity is expected to slow down significantly, with a projected CAGR of 1.5% from 2024 to 2026 [7] - The demand for polyester filament is anticipated to increase by 18% year-on-year in 2024, with an absolute increment of nearly 5 million tons [7] - The industry is undergoing consolidation, with the market share of the top six companies increasing from 48% in 2018 to 66% in 2023, indicating a trend towards higher industry concentration [7]

Investment Rating - The investment rating for Tongkun Co., Ltd. is "Buy" (maintained) [1] Core Views - The company reported a slight year-on-year growth in Q1 2025, with revenue of 19.42 billion yuan, down 8.01% year-on-year and down 23.11% quarter-on-quarter. The net profit attributable to shareholders was 611 million yuan, up 5.36% year-on-year and up 213.00% quarter-on-quarter. The performance is in line with expectations, and the company maintains its profit forecast for 2025-2027, expecting net profits of 2.541 billion, 3.648 billion, and 4.274 billion yuan respectively, with corresponding EPS of 1.06, 1.52, and 1.78 yuan, leading to PE ratios of 10.1, 7.0, and 6.0 times respectively. The outlook remains positive due to steady demand growth and an optimized supply structure, which is expected to lead to a recovery in long filament profitability [5][6][8] Financial Summary - In Q1 2025, the company produced and sold 3.29 million and 2.50 million tons of long filaments, respectively, with production up 4.9% year-on-year and sales down 3.3%. The overall production and sales rate was 76%. The sales gross margin for Q1 2025 was 7.71%, an increase of 1.00 percentage points year-on-year and 4.56 percentage points quarter-on-quarter. The average price difference for polyester long filament POY in Q1 2025 was 1,330 yuan/ton, up 21.1% year-on-year and 8.4% quarter-on-quarter [6][8][10] Financial Forecast - The financial forecast for Tongkun Co., Ltd. includes projected revenues of 94.684 billion yuan in 2025, with a year-on-year decrease of 6.5%. The net profit attributable to shareholders is expected to be 2.541 billion yuan, reflecting a significant year-on-year increase of 111.4%. The gross margin is projected to be 7.1% in 2025, increasing to 8.7% by 2027 [8][10][11]

Investment Rating - The investment rating for Tongkun Co., Ltd. is "Buy" (maintained) [1][5] Core Views - The company reported a slight year-on-year revenue growth in Q1 2025, with a revenue of 19.42 billion yuan, down 8.01% year-on-year and down 23.11% quarter-on-quarter. The net profit attributable to shareholders was 611 million yuan, up 5.36% year-on-year and up 213.00% quarter-on-quarter. The performance is generally in line with expectations [5][6] - The company maintains its profit forecast for 2025-2027, expecting net profits of 2.54 billion yuan, 3.65 billion yuan, and 4.27 billion yuan respectively, with corresponding EPS of 1.06 yuan, 1.52 yuan, and 1.78 yuan. The current stock price corresponds to PE ratios of 10.1, 7.0, and 6.0 respectively [5][6] - The report highlights the expectation of gradual recovery in long filament profitability due to steady demand growth and optimized supply structure, maintaining a "Buy" rating [5][6] Financial Summary - In Q1 2025, the company's long filament production and sales volumes were 3.29 million tons and 2.50 million tons respectively, with production up 4.9% year-on-year and sales down 3.3%. The overall production and sales rate was 76% [6] - The sales gross margin for Q1 2025 was 7.71%, an increase of 1.00 percentage points year-on-year and 4.56 percentage points quarter-on-quarter. The average price difference for polyester long filament POY was 1,330 yuan/ton, up 21.1% year-on-year and 8.4% quarter-on-quarter [6] - The financial forecast indicates a revenue of 94.68 billion yuan in 2025, with a year-on-year decrease of 6.5%. The net profit is projected to increase significantly by 111.4% in 2025 [8][10]

Group 1 - The company reported a total revenue of 67.09 billion yuan for 2024, representing a year-on-year increase of 9.1% [1] - The net profit attributable to shareholders for 2024 was 1.1 billion yuan, up 1.3% year-on-year, while the net profit after deducting non-recurring gains and losses was 960 million yuan, an increase of 7.1% year-on-year [1] - In Q4 2024, the company achieved a revenue of 17.89 billion yuan, a year-on-year increase of 3.6% and a quarter-on-quarter decrease of 0.2% [1] Group 2 - The polyester filament industry is experiencing a supply-demand balance, with a projected apparent consumption of 42 million tons in China for 2024, an increase of 8.7% year-on-year [2] - The company completed maintenance on five production units and added one new filament unit in 2024, leading to improved performance metrics across various production lines [2] - The gross profit margin and net profit margin for 2024 are expected to be 5.6% and 1.6%, respectively, showing limited changes compared to the previous year [2] Group 3 - The polyester filament industry is expected to see an upward trend in its economic environment, with a projected decrease in new capacity by 2.3% year-on-year for 2024 [3] - The industry has initiated a "High-Quality Development Initiative" aimed at improving profitability through self-regulation [3] - Despite trade tensions, the impact on the domestic polyester filament industry is expected to be limited due to China's dominant supply position [3]