Investment Rating - The report initiates coverage with a "Buy" rating for the company [6] Core Views - The company is a leading player in the domestic pulp molding industry, with a revenue CAGR of 22.79% and a net profit CAGR of 23.89% from 2019 to 2024, maintaining over 85% of its sales from exports [2] - The pulp molding industry is expected to benefit from global trends towards reducing plastic use, with the company positioned to capitalize on this shift due to its fully biodegradable and recyclable raw materials [3][45] - The company's strong mold design and manufacturing capabilities, along with a complete supply chain from mold to raw materials to production, provide a competitive edge and high profitability [4] - The establishment of production capacity in Thailand helps mitigate risks from trade disputes and enhances profit margins due to advanced production technology [5] Summary by Sections Company Overview - The company has maintained industry-leading performance and has a robust management team with significant experience in mold design and production [2][21] - The company has a market share of approximately 16% in the global pulp molding food service sector and about 20% in the domestic market [21] Investment Logic - The global consensus on reducing plastic production and consumption is driving demand for pulp molding products, which are environmentally friendly and cost-effective alternatives [3][39] - The company’s products are primarily made from natural fibers like sugarcane and bamboo, which are fully biodegradable and recyclable, positioning them favorably against other alternatives like PLA and PBAT [45][46] Production and Capacity - The company has developed a comprehensive supply chain that includes strong control over raw materials, mold design, and production processes, ensuring cost efficiency and high-quality output [4][24] - The Thai production facility, with an initial capacity of 35,000 tons, is operational and a second phase of 65,000 tons is planned, which will further enhance the company's growth potential [5][18] Financial Forecast and Valuation - Revenue projections for 2025-2027 are estimated at 1.568 billion, 2.505 billion, and 3.131 billion RMB, with corresponding net profits of 296 million, 568 million, and 755 million RMB [6][10] - The expected EPS for the same period is 2.89, 5.56, and 7.38 RMB, with a target price set at 88.89 RMB based on a PE ratio of 16X for 2026 [6]