Yangnong Chemical(600486) 光大证券·2025-03-25 11:41Investment Rating - The report maintains a "Buy" rating for the company [6] Core Views - The company's performance is under pressure due to declining pesticide prices, with a 9.09% year-on-year decrease in revenue to 10.435 billion yuan and a 23.19% drop in net profit to 1.202 billion yuan in 2024 [1][4] - The company has completed the first phase of the Yuchuang project, producing qualified products, which positions it to benefit from the recovery in the agricultural protection industry [3][4] Summary by Sections Financial Performance - In 2024, the company achieved revenue of 10.435 billion yuan, a decrease of 9.09% year-on-year, and a net profit of 1.202 billion yuan, down 23.19% year-on-year [1] - The average selling prices for raw materials and formulations fell by 16.0% and 9.4%, respectively, leading to a decline in revenue from raw materials by 13.1% to 6.418 billion yuan and a 7.8% decrease in formulation revenue to 1.545 billion yuan [2] - The company’s gross margin for raw materials decreased by 2.45 percentage points to 27.7%, while the gross margin for formulations increased by 2.39 percentage points to 29.8% [2] Project Development - The Yuchuang Phase I project in Liaoning has been completed and is in the process of trial production, with several products, including Kungfu Chrysanthemum Ester, already yielding qualified outputs [3] - As of the end of 2024, the company has invested 2.78 billion yuan in the Yuchuang project, accounting for 80% of the total budget [3] Market Outlook - The agricultural protection industry remains in a low prosperity state, but there are signs of recovery as inventory levels have been cleared and demand is gradually improving [3] - The company is expected to benefit from the overall improvement in supply-demand dynamics in the agricultural protection sector as the industry stabilizes [3][4] Profit Forecast and Valuation - The profit forecasts for 2025-2027 have been adjusted downwards, with expected net profits of 1.378 billion yuan, 1.625 billion yuan, and 1.910 billion yuan, respectively [4][5] - The company is positioned as a leader in the domestic pesticide industry, and the completion of the Yuchuang project is expected to enhance its product structure [4]