2023Q2 homed net profit + 215% month-on-month, issued share buyback plan, maintained "Buy" rating company to release 2023 semi-annual report, 2023H1 achieved revenue of 616 million yuan, year-on-year-31.34%; homed net profit of 58.29 million yuan, year-on-year-63.83%; corresponding to Q2 realized revenue of 342 million yuan, year-on-year-27.57%, month-on-month + 24.86%; return-to-mother net profit of 44.23 million yuan, year-on-year-45.64%, month-on-month + 214.55%. According to the prosperity of the company's main business and the situation of production and marketing, we cut by 2023 and maintain the profit forecast for 2024-2025. it is estimated that the net profit of 2023-2025 will be 1.74,3.16,392 million yuan, corresponding to EPS 1.27,2.30,2.85 yuan per share, and the current stock price corresponds to 26.8,14.8,11.9 times of PE in 2023-2025. We are optimistic that the company, relying on continuous R & D and innovation capabilities, high-quality customer structure, deep cultivation of display materials, pharmaceutical CDMO, electronic chemicals and other industries, the future growth momentum is sufficient to maintain the "buy" rating.

2023H1 pharmaceutical CDMO, electronic chemicals revenue increased year-on-year, comprehensive gross profit margin decreased. 2023H1, showing that the material / pharmaceutical CDMO/ electronic chemicals sector achieved sales revenue of 5.11 0.77 billion yuan respectively, compared with the same period last year.-37% OLED 14% shock 22%, among them: (1) the recovery degree of OLED business is greater than LCD, and the number of new products still maintains a high growth rate (2) the terminal new process drugs of the main products of the pharmaceutical plate are gradually released, and the customers increase the purchase of the supporting pharmaceutical intermediates of the terminal drugs. the income of the supporting products is more than 10 million, and some pharmaceutical intermediates are gradually mass produced and supplied, and the sales income increases slightly. (3) Electronic chemicals plate includes semiconductor photoresist monomer, TFT flat layer photoresist, membrane material intermediate and PI monomer, etc., and some mass-produced products maintain a trend of rapid growth. In terms of profitability, 2023H1's sales gross profit margin / net profit rate was 32.59% / 9.46% respectively, compared with the end of 2022-6.13/-7.19pcts, mainly due to the decline in 2023H1 operating income compared with the same period last year, the weakening of the overall production scale effect of the company, and the increase in unit direct labor and unit manufacturing costs; after the gradual consolidation of IPO investment projects, the depreciation of new fixed assets led to an increase in unit depreciation expenses.

Plan to buy back 5000-80 million yuan of company shares, announce investment in photoresist and high-end new materials industrialization project company also announced: (1) plan to buy back 5000-80 million yuan of company shares by centralized bidding for the implementation of employee stock ownership plan or equity incentive, the repurchase price does not exceed 51 yuan per share (including) (2) Dalihaitai, a wholly owned subsidiary, plans to invest in the industrialization of photoresist and high-end new materials, with a total investment of 490 million yuan for the production of photoresist, pharmaceutical intermediates and other electronic fine chemicals.

Risk tips: demand recovery is not as expected, customer orders decline, display technology iteration, exchange rate fluctuations and so on.