稀土产品产量增长，提带动市场占有率提升。上半年预计公司稀土冶炼分离产品产量同比增长约18%，稀土金属产品产量同比增长约16%，稀土功能材料产量同比增长约11%，上述三类产品产量均创同期历史新高。坚持内外部对标提升，深化降本增效，加工成本同比降低4.2%。Incident: The company recently released a performance forecast. It is expected to achieve net profit of 37-54 million yuan attributable to the owner of the parent company in the first half of 2024, a year-on-year decrease of 1002-1019 million yuan, or 94.9% to 96.5%.
Net profit without return to mother is 8-12 million yuan, a year-on-year decrease of 1003 million yuan to 1007 million yuan, a decrease of 98.8% to 99.2%.
Affected by the year-on-year decline in praseodymium prices, the company's profit declined. The rare earth supply pattern is uneven. This is due to the year-on-year increase in the first batch of rare earth total control indicators issued by the country in the first half of the year, the steady release of production capacity for recycling rare earth resources in the market, and the increase in imported mines affecting market supply and demand. The average price of 24H1 praseodymium oxide was 0.38 million yuan, down 33% year on year.
The increase in production of rare earth products led to an increase in market share. In the first half of the year, the company's production of rare earth smelting and separation products is expected to increase by about 18% year on year, the production of rare earth metal products by about 16% year on year, and the production of rare earth functional materials by about 11% year on year. The output of the above three types of products all reached record highs during the same period. Adhere to internal and external benchmarking, deepen cost reduction and efficiency, and reduce processing costs by 4.2% over the same period last year.
The “Rare Earth Management Regulations” were issued to promote the high-quality development of the industry. The regulations clarify the strategic status of rare earth resources. By implementing a series of measures such as total control, strict mining license approval, and strengthening environmental protection supervision, the excessive mining and waste of rare earth resources are curbed, which is conducive to the protective development of rare earth resources, standardizes industry development, and resolutely upholds the country's sovereignty and control over rare earth resources.
Considering recent rare earth prices, we lowered the company's 24-year sales unit price and gross margin assumptions. According to the production and marketing guidelines, we predicted that the company's earnings per share in 2024-2026 would be 0.15, 1.00, and 1.19 yuan (1.83 and 1.91 yuan for 24-25), respectively. Considering that the 24-25 rare earth price was at the bottom of the cycle, the company's profitability was weak in 24. The valuation switched to 2025, referring to the comparable company 18X PE in '25, and the corresponding target price was 18.00 yuan, and a purchase rating was given .
Risk warning
The macroeconomic growth rate is slowing down, the production capacity of the company's new construction projects is released or falls short of expectations, the risk of product price fluctuations, the risk of concentrate prices rising sharply, the risk of quota growth falling short of expectations, and the risk of inventory impairment.
