23H1 deducts 812 million yuan in non-net profit to maintain the "overweight" rating
Zhejiang Longsheng released its semi-annual report on August 25. 23H1 realized revenue of 7.219 billion yuan (yoy-20.5%), net profit of 792 million yuan (yoy-44.4%) and non-net profit of 812 million yuan (yoy-29.9%). Among them, Q2 realized revenue of 3.471 billion yuan (yoy-24.0%,qoq-7.4%) and net profit of 449 million yuan (yoy-53.0%,qoq+30.6%). We estimate that the return net profit of the company from 2023 to 2025 will be 2.248, 34.13 and 3.739 billion yuan respectively, and the corresponding EPS will be 0.69,1.05,1.15 yuan respectively. Comparable company's 23-year Wind unanimously expected that the average PE will be 11 times, taking into account the company's leading position in the dye industry and the future growth of various sectors in the investment project is better, give the company 23 years 15 times PE, the target price of 10.35 yuan, maintain the "overweight" rating.
The downstream demand of dyes is weak, and the quantity of new intermediates is better.
23H1, where the company is located, the downstream demand of dyes and intermediates is weak, and the market competition is intensified. Dye sales yoy-11.7% to 110000 tons, revenue yoy-20.8% to 3.85 billion yuan, unit price yoy-10.3% to 35,000 yuan / ton, gross profit margin yoy-5.5pct to 27.1% due to rising raw material cost The volume and market expansion of new intermediates are good, with sales yoy+1.4% to 43000 tons, revenue yoy-25.9% to 1.52 billion yuan, unit price yoy-26.9% to 35,000 yuan per ton, gross profit margin yoy-6.2pct to 36.3%; revenue from auxiliaries / inorganic products is 460 million yuan, and yoy-11.5%/-28.0%, gross profit margin is 21.8% soybean 8.4%.
The revenue-generating capacity of the real estate business is expected to be further enhanced, with non-recurring profits and losses falling year-on-year in the first half of 23 years. Real estate business revenue yoy+382.0% to 190 million yuan, plate gross profit margin yoy-29.5pct to 45.8%. Huaxing New Town project successfully completed the concrete pouring of T1 tower foundation and the foundation floor of high-rise residential area, and the large production certificate of Fuxinli high-rise apartment was successfully obtained, which is expected to generate income for the company in the future. The company's comprehensive gross profit margin is from-4.7pct to 26.3%, and the sales / management / R & D / financial expense rate is from + 0.9/+1.2/-0.2/-1.9pct to 4.6% and 5.6% to 5.6% and 3.6% to 3.6% and 1.1%, respectively. During the reporting period, the non-recurrent profit and loss was yoy-107.5% to-20 million yuan, mainly due to a substantial reduction in government subsidies.
Textile demand is expected to recover in the future, and various business projects under construction are promoted in an orderly manner. According to Baichuan Yingfu, the price of disperse dyes and reactive dyes on August 25 is 21x21 yuan / kg, which is relatively low since 2016. with the recovery of demand, the dye boom is expected to improve in the future. According to the semi-annual report, the company's annual production capacity of dyes / auxiliaries / intermediates is up to 114,500 tons. Under construction, the "annual output of 20,000 tons of H acid project", "annual output of 90740 tons of disperse dye filter cake and 60,000 tons of liquid dye information, automation transformation project" and "annual output of 36700 tons of resorcinol, 9258 tons of m-hydroxyaniline, 200 tons of acetyl inter-technical transformation project" are progressing smoothly, and the future is expected to be expanded. In terms of real estate, the current development cost reaches 21.27 billion yuan, and the follow-up is also expected to contribute to profit increment.
Risk tips: downstream demand is lower than expected; real estate business cash flow risk; cost volatility risk.