[BL: E_2S0U2M4M ary1] On January 23, the company released its three-quarter report for 2024. The company achieved total revenue of 1.892 billion yuan in the first three quarters, +19.99% year-on-year, and achieved net profit of 0.596 billion yuan to mother, or +15.10% year-on-year. Among them, Q3 achieved revenue of 0.597 billion yuan, +4.93% year-on-year, and realized net profit to mother of 0.192 billion yuan, or +11.71% year-on-year.

Comment:

Gross profit margin has been rising steadily, and the financial situation is stable. According to Wind, in the Q3 quarter, the company's gross sales margin was about 51.20%, a steady increase compared to 45.42% in Q1 and 49.44% in Q2. In the first three quarters of 2024, the company's net operating cash flow was 0.45 billion yuan, up 3.2% from the same period last year. At the end of the reporting period, the company's total assets were 5.79 billion yuan, up 4.1% year on year; total liabilities were 2.05 billion yuan, down 11.1% year on year; net assets were 3.74 billion yuan, up 14.8% year on year; the balance ratio at the end of the period was 35.4%, a decrease of 3.9 pct. The company's interest-bearing debt remained low, and the financial situation was steady.

Salt Lake lithium extraction technology has a cost advantage, and the company's multi-dimensional layout involves the lithium industry chain. In the first three quarters of 2024, the price of lithium carbonate was relatively low, but the cost advantage of the direct lithium extraction technology route in Salt Lake was obvious, showing high competitiveness, and the company's already put into operation projects maintained a high production load. The company continues to upgrade and optimize process technology and adsorbent products, exploiting the technical characteristics of adsorption technology in the form of a “material+device” function unit, pioneered the DLE production line's “removal of impurities” and “refining” assembly models, and realized a technical ecosystem where adsorption technology is flexible, self-evolving, and associated with the industrialization of lithium extraction in salt lakes. The company's multi-dimensional layout involves the lithium industry chain, continuously improving the application level of adsorption technology in the fields of lithium ore refining, lithium battery recycling, and associated mining. Among them, a number of industrialization projects have been signed in the fields of nickel extraction from laterite nickel ore, cobalt extraction and recycling, and coal and vanadium extraction.

The life sciences sector continues to develop, gradually opening up the global market. Benefiting from the good market performance of GLP-1 polypeptide drugs, the company's solid phase synthesis carrier business sales trend is good. In recent years, with seplife? With a high level of high-quality production capacity and continuous stable supply of 2-CTC solid phase synthesis carriers and sieber resins, the company has become an important supplier in the field of peptides. The company continues to lay out a global marketing and technical service network, continuously expand its localization team in North America and Europe, and enhance the brand's international influence.

Profit forecast and valuation: Optimistic about the steady development of the company's “basic warehouse” business, and orders in the salt lake lithium extraction and life sciences sector will continue to grow. The company is expected to achieve net profit of 0.903/1.122/1.365 billion yuan in 2024/2025/2026, corresponding to PE of about 29/23/19 times, respectively. Covered for the first time, it is covered for the first time, giving it a “buy” rating.

Risk warning: Downstream demand falls short of expectations, performance forecasts and valuations fall short of expectations.