Core views:

The company released its 2024 semi-annual report. In 24H1, the company achieved revenue of 0.772 billion yuan, +23.56% year over year; realized net profit of 0.18 billion yuan, +31.56% year over year, achieved net profit of 0.179 billion yuan without return to mother, +33.36% year over year. Among them, in 24Q2, the company achieved revenue of 0.387 billion yuan, +35.35% year-on-year, realized net profit of 0.103 billion yuan, +71.31% year-on-year, and realized net profit deducted from non-mother 0.102 billion yuan, or +76.01% year-on-year.

The business structure was optimized, and foreign trade realized growth. In 24H1, the company's own ship rental revenue and term rental revenue were +35.60% and +46.82% year-on-year, respectively, while outsourced ship charter revenue was -69.08% year-on-year. The optimization of the business structure led to an improvement in the company's gross margin, and the company's gross margin increased 2.17 pps year-on-year in the first half of the year. Looking at the growth momentum, in 24H1, the company's overseas revenue was 0.292 billion yuan, +112.37%. The foreign trade business achieved rapid growth. In the first half of the year, two chemical tankers totaling 0.0252 million DWT were put into international operation. The rapid growth in foreign trade revenue represented the boom in the foreign trade chemical transportation market and the strengthening of the company's foreign trade operation strength.

Domestic trade has maintained steady growth, and foreign trade has begun a second curve. In terms of domestic trade, in the context of a tight balance between supply and demand in the industry, the company is still expected to achieve steady growth in domestic trade business by expanding the capacity of the domestic trade chemical fleet. During the reporting period, the company's two domestic trade chemical tankers totaling 0.0112 million dwt are scheduled to be put into operation in 24q3, and 2 stainless steel chemical tankers each 0.013 million dwt are scheduled to be delivered and put into operation in '25. In terms of foreign trade, the rapid expansion of capacity makes the company hopeful to fully enjoy the upward cycle dividends. The company has a 0.013 million DWT ship that plans to carry out foreign trade business in the second half of '24, and has also signed contracts for the construction of 4 0.0259 million DWT methanol dual-fuel stainless steel chemical tankers. Two are scheduled to be put into operation in 25 years, and two are scheduled to be put into operation in 26 years.

Profit forecasting and investment advice. The company's 24-26 EPS is expected to be 1.28, 1.47, and 1.79 yuan/share, respectively. Considering the company's compound growth rate of 26%, the company is given a 24-year 15 PE valuation, corresponding to a reasonable value of 19.13 yuan/share, maintaining a “buy” rating.

Risk warning. The risk of demand fluctuations, capacity expansion falling short of expectations, capacity regulation policy risks, etc.