This report is read as follows:

The company's performance slightly exceeded expectations, mainly due to the improvement of the industry boom and the reduction of amortization expenses; the seed industry is expected to continue, the industry will usher in an era of improved seed competition, and the company's high R & D strength is expected to fully benefit.

Main points of investment:

Maintain and increase holdings. In 2024, the EPS of the maintenance company 2022Universe 2023Universe is 0.360.46Compact, the target price is 20.22RMB, and the "overweight" rating is maintained.

Event: the company released the three-quarter report of 2022, the company realized revenue of 1.536 billion yuan in the first three quarters of 2022, an increase of 28.09%, and realized a net profit of 38 million yuan, turning losses into profits. In the third quarter of 2022, revenue increased by 9.41% compared with the same period last year, and net profit increased by-13.64%.

The company's performance slightly exceeded expectations, mainly due to the improvement of the industry boom and the reduction of amortization expenses; in the first three quarters of 2022, the company's revenue increased by 28.09% compared with the same period last year, and its performance increased by 38 million yuan over the previous year. It is mainly due to 1) the growth of seed business income and order grain business; 2) the amortization expense of the first phase employee stock ownership plan decreased by 25 million yuan compared with the same period last year. In terms of expenses, the company's sales expense rate decreased 0.04pct, management expense rate decreased 1.7pct, financial expenses decreased 1.3pct, R & D expenses for 41.38 million yuan, continued growth, reflecting the company's emphasis on research and development, expansion category, the company's variety and quality is expected to continue to improve. In terms of advance sales, 2022Q3's advance collection is eye-catching, with a contract liability of 1.359 billion, an increase of 49% over the same period last year, reflecting the competitiveness of the company's varieties and laying a solid foundation for the growth of sales revenue in the new round of sales season.

The high demeanor of the seed industry is expected to continue, and the industry will usher in an era of improved seed competition; at present, grain prices at home and abroad are in a business cycle, and the demand of the seed industry as the upstream of agricultural products is rising; at the same time, the seed industry is revitalized and set the tone, policy and technology resonate, and the supply of new varieties is optimized and superimposed on GM commercialization, and high-tech companies hope to benefit.

Risk hints: epidemic disease risk, product price fluctuation risk, raw material price fluctuation risk.