The Zhitong Finance App learned that CICC released a research report stating that it maintains Nine Dragons Paper's (02689) “outperforms the industry” rating, the product structure continues to be optimized, and the energy cost advantage is gradually returning. Considering that demand recovery was weaker than expected, profit for the 2024/25 fiscal year was reduced by 60% and 25% to RMB 1,002.6 billion. The target price was reduced by 22% to HK$4.9, taking into account that the profit per ton had changed from loss to profit and the valuation office repaired the channel.

According to the report, the company expects net profit of 200 million to 400 million yuan for the first half of fiscal year 2024, and a loss of 1,389 billion yuan for the same period last year. The change from loss to profit is lower than the bank and market expectations, mainly due to weak domestic demand and the impact on imported paper supply exceeding expectations. The bank roughly estimated sales volume of 10 million tons. The company's net profit per ton for the first half of fiscal year 2024 was about 20 to 40 yuan. Of these, losses may still be in the third quarter of last year. Prices of white cards, gray, and cultural paper recovered significantly in the fourth quarter of last year, which may be an important reason why the company's single-quarter performance exceeded expectations.