XJJW(600888) 东方证券·2024-08-16 10:38Investment Rating - The report maintains a "Buy" rating for the company with a target price of 9.27 CNY, based on a 9X PE multiple for comparable companies [2][3]. Core Views - Demand is expected to stabilize, awaiting industry recovery. The company reported a revenue of 29.3 billion JPY for FY24Q1, a year-on-year decline of 28.8%, but the net profit attributable to shareholders turned positive at 450 million JPY. The company anticipates a sequential increase in revenue from consumer electronics and automotive electronics starting FY24Q2, with industrial equipment recovery lagging by one quarter [1][2]. - Fluctuations in aluminum prices have limited impact, with the aluminum foil and electrode foil markets remaining stable. Despite significant price volatility in the first half of the year, the electronic aluminum foil and electrode foil markets have not experienced major changes, with a slight price increase at the end of Q2 [1]. - The joint venture's coal-to-gas project has been approved, which is expected to enhance the company's resource advantages. The company holds a 14.22% stake in Tianchi Energy, which contributed approximately 1 billion CNY in equity investment income in 2023. The recent approval of Tianchi Energy's 2 billion cubic meters per year coal-to-natural gas project is expected to accelerate the realization of resource advantages [1]. Financial Forecasts and Investment Recommendations - The company has adjusted its electronic aluminum foil sales and gross margin assumptions downward while increasing the equity investment income assumptions. The projected earnings per share for 2024-2026 are 1.03 CNY, 1.12 CNY, and 1.16 CNY, respectively [2][3]. - The financial performance for 2022A, 2023A, and projections for 2024E, 2025E, and 2026E show a revenue decline in 2023A but a recovery expected in subsequent years, with a projected revenue of 7.87 billion CNY in 2024E, representing a year-on-year growth of 20.5% [4][6].