SUN PAPER(002078) 华创证券·2024-05-07 23:32Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 18 CNY per share [1][2]. Core Views - The company's profitability is steadily improving, supported by its integrated competitive advantages in the industry [1]. - In 2023, the company achieved a revenue of 39.54 billion CNY, a year-on-year decrease of 0.6%, while the net profit attributable to shareholders was 3.09 billion CNY, reflecting a year-on-year increase of 9.9% [1][3]. - For Q1 2024, the company reported a revenue of 10.18 billion CNY, a year-on-year increase of 3.9%, and a net profit of 960 million CNY, which is a significant year-on-year increase of 69% [1][3]. Financial Summary - The company’s revenue by product in 2023 includes: - Non-coated cultural paper: 13.31 billion CNY (+22.6%) - Coated paper: 3.51 billion CNY (+10.4%) - Corrugated box paper: 9.81 billion CNY (-5.6%) - Laminated paper: 1.26 billion CNY (-24.6%) - Household paper: 2.05 billion CNY (+33.7%) - Dissolving pulp: 3.67 billion CNY (-12.1%) - Chemical pulp: 1.84 billion CNY (-7.8%) - Chemical pulp: 1.75 billion CNY (-47.8%) - Electricity and steam: 1.81 billion CNY (-9.4%) [2]. - The company’s gross margin improved to 15.9% in 2023, up 0.7 percentage points year-on-year, and reached 18.0% in Q1 2024, an increase of 4.5 percentage points year-on-year [2][3]. - The projected net profits for 2024, 2025, and 2026 are 3.78 billion CNY, 4.16 billion CNY, and 4.50 billion CNY, respectively, with corresponding PE ratios of 11, 10, and 9 [2][3]. Growth Potential - The company is positioned as a leader in the integrated forest-pulp-paper industry, with capacity expansion driving growth. The integrated advantages are reinforced by the development of three major bases in Shandong, Guangxi, and Laos [2]. - The report anticipates continued growth in profitability due to effective cost control and rising demand in downstream publishing groups, which is expected to support pricing in Q2 [2].