Main points of investment
Event: Jiangshan shares released its semi-annual report for 2023, with operating income of 2.673 billion yuan during the reporting period, down 48.91% from the same period last year; net profit of 194 million yuan from home, down 84.03% from the same period last year; and net profit of 197 million yuan from non-home, down 84.08% from the same period last year. According to the latest total share capital, earnings per share were 0.44 yuan, down 84.29% from the same period last year.
From the perspective of a single quarter, 2023Q2 achieved an operating income of 1.32 billion yuan in a single quarter, down 47.45% from the same period last year and 2.43% from the previous year; the net profit from home was 70 million yuan, down 87.64% from the same period last year and 43.31% from the previous quarter; and the net profit from non-return was 77 million yuan, down 87.18% from the same period last year and 36.05% from the previous year.
Maintain the investment rating of "overweight". The price of glyphosate, the company's main product, fell, while the performance of 23H1 declined compared with the previous month. Downstream demand is under pressure, and the production, sales and prices of the company's products have declined compared with the same period last year.
Jiangshan Co., Ltd. is a leading enterprise in the pesticide industry in China, with herbicides, pesticides and other pesticide products. The company is a leading enterprise in the glyphosate industry with a production capacity of 70,000 tons of glyphosate. At present, the demand for glyphosate is affected by the high inventory of preparations, and the price fluctuates. We believe that glyphosate is an important herbicide in the world and its demand is relatively rigid. We believe that with the inventory consumption of preparation enterprises, the pick-up of purchase orders is expected to lead to a rebound in the performance of the company. In addition, the company's other products trichlorfon, dichlorvos, amide herbicide pesticide products market competition pattern is better, the price is relatively stable, which is conducive to the company to maintain a stable profit space. The company extends downstream to the preparation field and acquires Harbin limin to gradually distribute the preparation terminal market in the northeast and other places. The company invests 190 million in Nantong base to build an intelligent technical renovation project with an annual output of 100000 tons of preparations to expand and enrich the product matrix of preparations. The company has a large number of construction and planning projects and is progressing smoothly. In the first half of 23 years, the company completed the construction of the second phase of flame retardant, the first phase of heating center and the technical transformation of green plant protection products diazinon and Metolachlor. In terms of new production capacity, the company laid out a new and innovative green herbicide raw drug and preparation project in the second production base of Zhijiang, Hubei Province, to promote the industrialization of innovative drug JS-T205. The company has set up the third base in Guizhou to build the integration project of upstream and downstream industrial chain of phosphorus chemical industry. at present, the joint venture company has been registered. With the promotion of the company's innovative pharmaceutical products and the gradual recovery of pesticide demand, the company has sufficient growth and future performance can be expected. With the promotion of the company's innovative pharmaceutical products and the gradual recovery of pesticide demand, the company has sufficient growth and future performance can be expected. We adjust the company's profit forecast and estimate that the EPS from 2023 to 2025 will be 1.55,1.93,2.31 yuan respectively, maintaining the "overweight" rating.
Risk tips: the risk of low product prices, the risk that new projects are not put into production as expected, and the risk of tightening environmental protection policies.