Futu news on June 17th,$WUHAN YOUJI (02881.HK)$Today, the pre-market opened high and closed up 70.18% to HKD 9.36, with a turnover of HKD 3.8582 million and a total market value of HKD 873 million. Each lot is 500 shares, and without considering transaction fees, each lot earns HKD 1,930.
Market source: Futu Securities >
Investment highlights
Top toluene derivative supplier: The company mainly focuses on the production of toluene oxide and chlorination products, benzoic acid ammonia products, and other fine chemical products. The company's toluene derivatives are widely recognized in the organic synthesis chemical industry, which can be used as food preservatives, household chemicals, animal feed acidifiers, and synthetic intermediates for agricultural chemistry and pharmaceutical purposes. According to the Frost & Sullivan report, based on the 2022 sales income, the company is the largest producer of benzoic acid, sodium benzoate, and benzyl alcohol in China, accounting for 59.1%, 37.3%, and 36.0% of China's total market revenue in 2022, respectively. In the global market, the company ranks second among benzoic acid, sodium benzoate, and benzyl alcohol producers with a respective share of 35.7%, 21.8%, and 21.3% of the global market total revenue in 2022.
Excellent products and diverse categories: The company's products are sold to more than 70 countries and regions. As of the final feasible date, the company's self-made product portfolio mainly includes five toluene oxidation products, two toluene chlorination products, two benzoic acid ammonia products, and more than 20 other fine chemical products with a wide range of market uses. In 2021, 2022, and 2023, the company's product sales volume was approximately 362,300 tons, 375,800 tons, and 346,100 tons, respectively.
Risk warning
Fluctuation risks in raw material prices: The company purchases raw materials from a small number of suppliers, especially toluene. The price of raw materials (especially toluene) is affected by its upstream products (i.e., crude oil). Shortages in raw material supply or large fluctuations in raw material purchase prices could have an adverse impact on the company's profitability and business performance.
Demand fluctuation risks: Currently, most of the company's revenue comes from the sales of self-made products (including toluene oxidation products, toluene chlorination products, benzoic acid ammonia products, and other fine chemical products), which may be affected by various factors, such as downstream industry customer demand in China and global markets, raw material prices for production, and overall economic conditions. The demand and price of self-made products may fluctuate. If there are any significant adverse changes in the market demand and price of self-made products, the company's revenue and profitability may be negatively affected.
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Editor/Afina