We will steadily increase and replenish working capital and introduce war investment to strengthen industrial coordination. The company announced on September 14, 2023 that it issued 47.51 million shares to Wuliangye Group and 11.5 million shares to Jianfa Paper at a price of 9.60 yuan per share, raising 509 million yuan. The funds raised will be used to replenish liquidity and repay debts. Jianfa Paper has a leading advantage in the field of pulp and paper trade, has important strategic resources in supply chain operation, channel sales network and product R & D design, and can support Yibin Paper in the dimensions of capital, channel, operation and R & D. give full play to synergy. The company is expected to achieve rapid and sustainable growth, business scale and profitability continue to improve.

Policy catalysis, bamboo pulp paper into the fast lane. In November 2021, the National Forestry and Steppe Bureau and the National Development and Reform Commission put forward three main tasks for the development of bamboo industry in the "opinions on accelerating the Innovation and Development of Bamboo Industry". These include: accelerating the accurate cultivation of bamboo resources, bamboo pulp papermaking ecological environmental protection technology, disposable degradable bamboo fiber tableware and container injection molding processing and other new technology research and development. From 2013 to 2022, the total production of bamboo pulp in China increased from 1.37 million tons to 2.46 million tons, with an average annual compound growth rate of 6.7%.

The company has bamboo resources "geographical location". Sichuan is a province with large bamboo resources, and Yibin City is not only the rich area of bamboo resources in the country, but also the core area of Sichuan bamboo industry cluster. Sichuan Province concentrated more than 72% of the country's primary bamboo pulp output, with an output of about 1.35 million tons in 2022. The company is the largest food base paper manufacturer in southwest China and the country's leading all-bamboo pulp living base paper enterprise, the first all-bamboo pulp products, in a leading position in the bamboo pulp and paper industry.

The market scale of food packaging base paper is growing steadily. According to the statistics of forward-looking Industrial Research Institute, the scale of China's food packaging paper market increased from 1.0738 million tons to 2.67 million tons from 2011 to 2021, with an annual compound growth rate of 9.5%. Paper packaging has excellent environmental protection performance, such as recyclable, degradable, recyclable and sustainable raw materials. with the orderly implementation of the plastic ban, food packaging paper is one of the ideal substitutes for plastics. driven by policy guidance and the development of industry technology, there is broad room for growth in the aviation industry, catering industry, hotels, convenience stores, Shangchao, takeout and other fields.

Investment suggestion: the operating income of the forecast company for the fiscal year 2023-2025 is 23.562412 / 2.47 billion yuan, with a year-on-year growth rate of 2.4% 2.4% and 2.4% respectively, and the net profit is 0.66 pound 0.86 million yuan, respectively, and the year-on-year growth rate is 122.7%, 30.4% and 26.3%, respectively. The corresponding predicted PE is 30.7 amp, 23.5 pm, 18.6 times. The introduction of Jianfa Paper as a war investment is expected to enable the company to fully coordinate in capital, channels, operation, R & D and other aspects, so as to achieve the continuous improvement of business scale and profitability. Cover Yibin Paper for the first time and give the company an "overweight" rating.

Risk hints: the slowdown in macroeconomic growth has a negative impact on the company's production and operation; the sharp rise in the prices of commodities such as coal and chemical raw materials has a negative impact on the company's profitability; a higher level of asset-liability ratio may bring a certain degree of liquidity risk to the company; the growth rate of the food packaging paper industry is not as fast as expected; the industry competition intensifies, reducing the company's product profitability.