this week (January 1-January 5), we selected five listed companies with high attention, namely, China Shenhua, Rongsheng Petrochemical, Haguang Information, Lianlong and Yongtai Energy, and selected research reports issued by analysts from Minsheng Securities, Haitong International, Huajin Securities, Kaiyuan Securities, Capital Securities and other institutions to bring you a selection of individual stock research reports this week.

1. China Shenhua (A stock code: 601088; Hong Kong stock code: 01088)

The company belongs to the coal industry. On December 25, the company announced that recently, the No. 2 generator set of the first phase of the 2 × 1000MW new project of Guoneng Qingyuan Power Generation Co., Ltd., a 51% holding subsidiary of the company, successfully passed 168 hours of continuous full-load trial operation and was officially put into commercial operation. So far, two 1000MW ultra-supercritical coal-fired secondary reheat generating units in Qingyuan Phase I have been completed and put into operation. On December 18, 2023, the company announced the operation of Unit 2 of Yueyang Project and Unit 1 of Qingyuan Phase I.

In response to the above events, this week, we have selected the research reports issued by analysts of Minsheng Securities.

Share price movement this week:

the closing price of a shares on January 5 was 33.45 yuan, with the stock price rising 6.70 this week. Hong Kong shares closed at HK $28.10, with the stock price rising 5.05 this week.

1. Institutions: Minsheng Securities

Analysts: Zhou Tai, Li Hang, Wang Shanshan

Rating: Recommended

Research Summary:

1) Qingyuan and Yueyang units are put into operation, and power generation is expected to increase in 2024. In October 2023, Unit 1 of Yueyang Project was put into operation, and Unit 2 was put into operation at the end of the year, with a total installed capacity of 1900MW. For the first time, the project adopted double-machine regenerative technology with balanced generators in the primary reheat unit, and the flue gas was deeply utilized. The designed coal consumption for power supply was 267g/kWh, which was in the leading level in China. The two units of Qingyuan project were all put into operation in December, with a total installed capacity of 1020MW. After the two generating units of Qingyuan Phase I are all put into operation, it is expected to generate about 10 billion kwh per year (about 4.8 of the company's annual power generation), which will effectively alleviate the power supply pressure in Guangdong Province, provide guarantee for energy security in Guangdong-Hong Kong-Macau Greater Bay Area, and promote social and economic development in northern Guangdong. Considering that the Qingyuan and Yueyang projects will be put into operation in the fourth quarter of 2023, the company's power generation is expected to continue to increase in 2024.

2) The company's power reserve projects are still abundant, and power production capacity is expected to continue to expand in the future. As of the end of September 2023, the company has a total of 7 coal-fired power generation projects and 2 gas-fired power generation projects under construction, with a total of 17 units of 11.75 million kilowatts installed, and the units under construction are expected to be put into operation before 2025, based on the company's installed power capacity of 40518 megawatts (data on September 30, 2023), the installed scale will expand by 29% after all projects under construction are put into operation.

3) Coal production capacity is expected to increase by 76.7 million tons/year, medium-term growth is expected. The Company announced its intention to acquire shares in Dayan Coal and Hangjin Energy, involving a coal production capacity of 20.7 million tons/year. Xinjie mining area is the company's reserve resource area, the planned production capacity scale of 56 million tons/year, the company's production capacity scale increased by 76.7 million tons/year after all put into operation, the company has obtained the Taigemiao North District Xinjie No. 1 well, Xinjie No. 2 well prospecting certificate, is orderly promoting the preliminary work of the mine.

4) Stable high earnings and abundant cash flow provide high dividends, with a dividend ratio of not less than 60% in 2022-2024. The company has abundant net cash and the level of capital expenditure has shown a downward trend since 2021. The dividend for 2022 is 2.55 yuan/share, with a dividend payout rate of 72.8. Based on our earnings forecast of 63.144 billion yuan in 2023, the closing price on December 25, 2023 and the dividend payout ratio of 72.8 in 2022, the company's dividend rate in 2023 is 7.28, and the guaranteed dividend rate is 6% based on the dividend ratio of 60% in the shareholder return plan from 2022 to 2024.

5) Investment advice: We expect the company's net profit to be 631.44/671.93/68.675 billion yuan from 2023 to 2025, corresponding to EPS of 3.18/3.38/3.46 yuan/share, and PE of 10/9/9 times on December 25, 2023.

2. Rongsheng Petrochemical (stock code: 002493)

The company belongs to the chemical fiber industry. On January 2, 2024, the company and Saudi Aramco signed a "Memorandum of Understanding". The memorandum of understanding shows that the two parties are discussing Rongsheng Petrochemical (or its related parties) intends to acquire Saudi Aramco Jubail Refining and Chemical Company ("SASREF") 50% equity, and intends to increase production capacity through expansion, improve product flexibility, complexity and quality. At the same time, the two sides are also discussing the potential acquisition of no more than 50% (50%) equity of Ningbo CICC Petrochemical Co., Ltd. (hereinafter referred to as "CICC Petrochemical") by Saudi Aramco (or its related parties), and the joint development of the upgrading and expansion of CICC Petrochemical's existing equipment and the development of the new downstream Rongsheng New Materials (Zhoushan) project (hereinafter referred to as "CICC Petrochemical Transaction").

In response to the above events, this week, we have selected research reports from analysts at Haitong International and Guohai Securities.

Share price movement this week:

closing price on January 5: 10.28 yuan, with the stock price down 0.68 percent this week.

1. Organization: Haitong International

Analyst:Junjun Zhu, Xin;Hu, Borong Li

Target price:13.65 yuan

Rating: Excellent over City

Research Summary:

1) intends to strengthen equity cooperation with Saudi Aramco. On January 2, the company and Saudi Aramco signed a "Memorandum of Understanding". The two parties are discussing the company (or its related parties) to acquire 50% of the equity of Saudi Aramco Jubail Refining and Chemical Company, and plan to increase production capacity and improve product flexibility through expansion., Complexity and quality. At the same time, the two sides are also discussing the potential acquisition of no more than 50% (50%) shares of Ningbo Zhongjin Petrochemical by Saudi Aramco (or its related parties), and jointly develop the upgrading and expansion of existing units of Zhongjin Petrochemical and the development of a new downstream Rongsheng New Materials (Zhoushan) project. In 2023, the company introduced Saudi Aramco as a strategic investor, with Saudi Aramco holding approximately 10% of the company's equity. We believe that the two parties intend to further strengthen equity cooperation this time, which will help the two parties to develop technology and business cooperation, and promote the realization of the strategic goals of both parties.

2) It is proposed to construct Jintang project and strengthen the layout of new materials. The company plans to invest 67.5 billion yuan to build Jintang New Material Project. The project is mainly to extend the industrial chain of Zhejiang Petrochemical and CICC Petrochemical. The planned construction includes 1 million tons/year EVA, 200000 tons/year POE, 300000 tons/year α-olefin, 100000 tons/year CHDM, 50000 tons/year UHMWPE, PTT, PBS, PBT, DMC, polyether polyol, ABS, polycarbonate and other devices. According to the company's feasibility study report, after the completion of the project, the company is expected to achieve a net profit of about 15.5 billion yuan per year.

3) Relying on the 40 million tons/year refining and chemical integration project, speed up the layout of new materials. Aiming at the field of new energy and high-end materials, the company has deployed a number of new energy and new material products such as EVA, DMC, PC and ABS, and the product chain has been continuously enriched. With the steady progress of new projects, the company's production capacity of new energy materials, renewable plastics, special synthetic materials and high-end synthetic materials will be expanded in an orderly manner, and the transformation of new materials will gradually accelerate.

4) to introduce Saudi Aramco as a strategic investor. Rongsheng Holdings, the controlling shareholder of the company, transferred its 1.013 billion shares of the company to AOC by agreement at a transfer price of 24.3 yuan per share. After the transfer is completed, Rongsheng Holdings holds 51.46 of the company's equity and AOC holds about 10%. We believe that full cooperation with Saudi Aramco can, on the one hand, obtain a long-term and stable supply of crude oil and other chemical raw materials, on the other hand, it is also expected to expand the overseas sales channels of chemical products. At the same time, the two sides to strengthen technology sharing, joint research and development of chemical products, is expected to complement the technical advantages, to achieve resource sharing.

5) Earnings forecasts and investment ratings. We expect the Company's net profit for 2023-2025 to be $2.1 billion, $6.8 billion and $10.2 billion, EPS to be $0.21, $0.67 and $1.01, respectively, and BPS to be $4.72 in 2023. Reference to comparable company valuation level, give it 2023 PB 2.9 times, corresponding to the target price of 13.65 yuan (corresponding to 2023 65 times PE,PEG is 1.5), maintain the "better than the market" rating.

2. Institutions: Guohai Securities

Analysts: Li Yonglei, Dong Bojun, Yang Lirong

Rating: Buy

Research Summary:

1) Signed a memorandum of understanding with Saudi Aramco to help overseas refinery layout and new materials construction.

I. the company operates the 40 million-ton refining and chemical integration project of zhejiang petrochemical, the world's largest monomer refinery, with a daily crude oil processing capacity of 800000 barrels per day, an annual ethylene output of 4.2 million tons and an annual aromatics output of 11.8 million tons. Saudi Aramco is one of the world's largest integrated international oil groups, accounting for about 1/8 of the world's crude oil production, with strong resource endowments, production capacity advantages and financial strength, and is the company's most important crude oil supplier in recent years. From January to November 2023, the total amount of all types of related transactions that have occurred between the Company and Saudi Aramco (including other related persons controlled by the same entity or who have a control relationship with each other) was RMB 62.008 billion.

ii. The Company's proposed cooperation with Saudi Aramco on the SASREF transaction and the CICC Petrochemical transaction marks a further upgrade of the Company's cooperation with Saudi Aramco. On the one hand, according to the China Securities Journal, SASREF has a crude oil refining capacity of 305000 barrels per day (about 15.15 million tons per year). It is located in Jubail Industrial City, Saudi Arabia. It is one of the largest industrial cities in the world, with complete industrial infrastructure and geographical advantages. Outstanding, close to low-cost raw materials and fuel sources. The company's proposed acquisition of a SASREF50 stake is expected to be a key step in the company's overseas refinery layout. On the other hand, Saudi Aramco focuses on its crude oil chemical strategy, favoring refining and chemical integration projects with high chemical conversion rates. In this memorandum, Saudi Aramco intends to take a stake in the upgrading of Ningbo CICC and the development of Rongsheng New Materials (Zhoushan), with the aim of leveraging the company's international leading chemical industry.industry and new materials technology advantages to strengthen its expansion in downstream applications.

2) optimistic that the PX business cycle continues, the company as a PX leader will benefit. Q4 in 2023, PX-crude oil spread reached 4291 yuan/tonne, up 12% YoY and-2% YoY. In December 2023, the PX-crude oil spread was 4253 yuan/tonne, at the historical 59% level (January 2012-December 2023). It is optimistic that the PX boom cycle will continue in 2024. From the cost side, the geographical situation is still tense and there is still room for international crude oil to rise in 2024. On the supply and demand side, 2024 is a window period for PX production, and the domestic PTA demand for raw materials remains extremely high. According to Baichuan Yingfu, at least 4.5 million tons of PTA will be put into operation in 2024, mostly in the first half of 2024. The company is the domestic PX leader, as the PX business climate continues, the company's performance is expected to continue to improve.

3) continue to add code layout of new materials business, high value-added products have been put into production.

I. in August 2022, the company announced three major projects with a scale of 100 billion, including 3# ethylene and its downstream chemicals project, high-tech resin project and high-end new materials project. the products mainly include EVA, DMC, PC, ABS, α-olefin, POE adiponitrile, PMMA, etc. according to the company's calculation, the total annual net profit of the projects is expected to reach 16.4 billion yuan. Among them, the ABS plant with an annual output of 400000 tons, the solution-polymerized styrene-butadiene rubber plant with an annual output of 60000 tons and the rare earth rubber with an annual output of 100000 tons/the nickel-based cis-polybutadiene rubber plant with an annual output of 70000 tons were successfully put into operation in the first half of 2023, and the styrene plant with an annual output of 600000 tons and vinyl acetate plant with an annual output of 300000 tons were put into operation in the second half of 2023, successfully producing qualified products. On August 30, 2023, the company announced that Zhejiang Petrochemical 1000 tons/year alpha-olefin pilot plant feeding success.

ii. at the same time, the company has also established two wholly-owned subsidiaries, rongsheng new material (zhoushan) and rongsheng new material (taizhou). rongsheng new material (zhoushan) will rely on zhejiang petrochemical and sinopec to develop fine chemicals and new chemical materials. on January 2, 2024, rongsheng new material (zhoushan), a wholly-owned subsidiary of the company, plans to invest 67.5 billion yuan to construct jintang new material project, this project is to extend the downstream industrial chain of Zhejiang Petrochemical and CICC Petrochemical, and is expected to achieve an average annual operating income of 86.877 billion yuan after the completion of the project. Rongsheng New Materials (Taizhou) will focus on high-end polyolefin special rubber and elastomers, engineering plastics, etc., will be built into a world-class chemical new materials highland and RCEP high-level open cooperation demonstration area, the current preliminary work are orderly progress.

4) profit forecast and investment rating: considering the company's operation in the first four quarters, we have appropriately lowered the company's performance. based on the principle of prudence, we have temporarily not considered the impact of the transactions in this memorandum. it is estimated that the company's net profit attributable to its parent in 2023-2025 will be 14.80, 70.44 and 10.123 billion yuan respectively, corresponding to PE 70, 15 and 10 times respectively. considering the company's future growth, we maintain the "buy" rating.

3. Haanguang Information (stock code: 688041)

The company belongs to the semiconductor industry. On January 2, 2024, the Company released its 2023 earnings forecast: expected revenue of 56.8-6.26 billion yuan, +10.82-22.14% YoY; net profit attributable to parent of 11.8-1.32 billion yuan, +46.85-64.27% YoY; net profit attributable to non-parent of 10.55-1.195 billion yuan, +40.96-59.66% YoY.

In response to the above events, this week, we selected research reports issued by analysts from Ping An Securities and Huajin Securities.

Share price movement this week:

closing price on January 5: 71.73 yuan, with the stock price up 1.06 percent this week.

1. Institutions: Ping An Securities

Analysts: Fu Qiang, Yan Lei, Chen Fudong

Rating: Recommended

Research Summary:

1) The company's performance in 2023 was excellent, with significant year-on-year growth in revenue and profit. According to the company's preliminary accounting, the company is expected to achieve operating income of about 5.68 billion -6.26 billion yuan (median 5.97 billion yuan) in 2023, which will increase by 0.555 billion -1.135 billion yuan (median 0.845 billion yuan) compared with the same period last year, up 10.82-22.14 (median 16.48); It is expected to realize net profit of 1.18 billion -1.32 billion yuan (median 1.25 billion yuan), compared with the same period last year, it will increase by 0.376 billion yuan to 0.516 billion yuan (median of 0.446 billion yuan), up 46.85-64.27 (median of 55.56). The company has always focused on the general computing market, maintained high-intensity R & D investment, and continuously enhanced its product competitive advantage through technological innovation, product iteration, performance improvement and other measures, and continued to improve in terms of revenue and gross profit margin. it has further consolidated the company's leading advantage and market competitiveness, and achieved sustained growth in performance.

2) In 2023, the company will continue to introduce new products and maintain an excellent product iteration rhythm. The company continues to release new products in the fields of CPU and DCU, and its performance has been greatly improved, marking a new level of domestic CPU and GPGPU, and further consolidating the company's market competitiveness in the fields of Xinchuang and AI. It not only promotes the company to achieve excellent performance in 2023, but also provides a strong guarantee for the continuous growth of the company's future performance.

3) Artificial intelligence continues to be hot, the company's DCU products are expected to fully benefit. AIGC needs the support of the underlying AI acceleration computing power. The market has a large demand for AI acceleration cards. However, the United States has continuously issued restrictive policies to prevent Avida's advanced GPGPU from entering the Chinese market, forcing Avida to continuously introduce customized version acceleration chips for the Chinese market, with obvious performance discounts. With the continuous tightening of the US restrictive policies, the performance of customized version acceleration chips is also continuously declining, the performance advantage of foreign accelerated chips that can enter the Chinese market is gradually reduced compared with the company's DCU products, which is obviously good for the company and is expected to accelerate the release of the company's DCU products.

4) investment advice: the company spans the two tracks of xinchuang and AI, with CPU corresponding to xinchuang and DCU corresponding to AI. the company has maintained a fast product iteration rhythm in these two major tracks, with significant improvement in product performance, continuous enhancement of competitiveness in the market, and sufficient guarantee for future performance growth. According to the company's 2023 performance forecast and the judgment of the industry, we have adjusted the company's performance forecast. It is estimated that the company's net profit from 2023 to 2025 will be 1.253 billion yuan (the previous value is 1.292 billion yuan), 1.748 billion yuan (the previous value is 1.727 billion yuan), 2.224 billion yuan (the previous value is 2.329 billion yuan), and EPS will be 0.54 yuan, 0.75 yuan and 0.96 yuan respectively, corresponding to the closing price on January 2, 2024, the company's PE for 2023-2025 will be 134.2X, 96.2X, and 75.6X, respectively. We believe that the overall competitiveness of the company's products has been steadily improved, and it is expected to shine in the domestic market and maintain the company's "recommended" rating.

2. Institution: Joaquin Securities

Analysts: Sun Yuanfeng, Wang Chenfu

Rating: Overweight-A

Research Summary:

1) The company released its annual performance forecast for 2023. During the reporting period, it is expected that the operating income in 2023 will increase by 554.7333 million yuan to 1,134.7333 million yuan compared with the same period last year, with a year-on-year increase of 10.82 to 22.14. It is expected that the net profit attributable to the owners of the parent company in 2023 will increase by 376.4599 million to 516.4599 million yuan compared with the same period last year, an increase of 46.85 to 64.27 percent year-on-year. It is expected that the net profit attributable to the owners of the parent company after deducting non-recurring gains and losses in 2023 will increase by 306.5352 million yuan to 446.5352 million yuan compared with the same period last year, an increase of 40.96 to 59.66 percent year-on-year.

2) the performance continued to grow, and the Q4 single-quarter performance in 2023 reached a new high: according to the 2023 annual performance forecast released by the company, according to the preliminary calculation of the financial department, it is expected to realize the operating income of 5,680 million yuan to 6,260 million yuan in 2023, and the net profit attributable to the owner of the parent company is expected to be 1,180 million yuan to 1,320 million yuan in 2023. According to the company's report for the third quarter of 2023, the company achieved revenue of 3,942.723 million yuan in the first three quarters and a net profit of 901.6345 million yuan attributable to the owners of the parent company. Therefore, it is expected that the company will achieve revenue of about 1737.277 million yuan to 2317.277 million yuan in Q4 2023, and realize the net profit attributable to the owner of the parent company of 278.3655 million yuan to 418.3655 million yuan. In Q4 2023, the single-quarter revenue will reach a record high, and the single-quarter net profit attributable to the parent will also belong to relatively high water level. For the full year 2023, revenue grew 10.82 to 22.14 percent year-on-year, net profit attributable to the parent company grew 46.85 to 64.27 percent year-on-year, and net profit attributable to owners of the parent company, net of non-recurring gains and losses, grew 40.96 to 59.66 percent year-on-year. The main reason for the change in performance in this period is that the company has always focused on the general computing market, maintained high-intensity R & D investment, and continuously enhanced its product competitive advantage through technological innovation, product iteration, performance improvement and other measures. continue to improve in terms of revenue and gross profit margin, further consolidate the company's leading advantage and market competitiveness, and achieve sustained growth in performance.

3) New product release, broad market prospects: the company adheres to independent innovation, through the iterative design and development of multi-generation processor products, has basically formed a "mass production generation, research and development generation, planning generation" product continuous evolution rhythm. According to the investor research minutes released by the company on April 30, 2023, the highest specification of Haiguang 3 series chips has 32 cores and 64 threads, with up to 128 PCle4.0 channels, supporting the memory frequency to 3200MHZ. Compared with the previous generation of products, the overall measured performance of Hainguang 3 has been improved by about 45%. In terms of SOC design, I/O bandwidth, finger-taking unit, functional module, defense mechanism, etc., Haiguang 3 has been optimized to varying degrees, and its comprehensive performance has greatly increased. According to the company's 2023 semi-annual report, Haiguang CPU series product Haiguang III is the main sales product during the reporting period. In terms of new products, Deep Calculation II has been released in Q3 2023, which has achieved the goal of being in the big market.Data, artificial intelligence, business computing and other fields of commercial. Company Haiguang 4 has been released, is expected to drive sales growth in the future, the market prospects. According to IDC's report, China's server market will ship 4.12 million units in 2021, up 9.6 percent year-on-year. Vendor revenue reached $26.45 billion billion, up 15.4 percent year-on-year. By processor type, X86 server vendor revenue reached $25.46 billion, up 15.2 percent year-on-year; RISC/EPIC server vendor revenue reached $0.25 billion billion, down 36.5 percent year-on-year; CISC server vendor revenue reached $0.16 billion billion, up 31.7 percent year-on-year; ARM server vendor revenue reached $0.57 billion billion, up 85.4 percent year-on-year. We believe that the company's CPU products have a broad market space, will significantly benefit from the domestic substitution penetration rate continues to increase the industry trend.

4) Investment advice: Considering that the 2023 year results forecast exceeded expectations, we raised the company's 2023-2025 revenue forecast from 5.71 billion yuan, 7.97 billion yuan and 10.792 billion yuan to 6.043 billion yuan, 8.437 billion yuan and 11.422 billion yuan respectively, with year-on-year growth rates of 17.9 percent, 39.6 percent and 35.4 percent respectively, the net profit forecast will be raised from 1.17 billion yuan, 1.667 billion yuan and 2.302 billion yuan to 1.228 billion yuan, 1.728 billion yuan and 2.309 billion yuan respectively, with year-on-year growth rates of 52.9, 40.7 and 33.6 respectively, corresponding to PE of 137.5 times, 97.8 times and 73.2 times respectively. Considering that the company is the leading domestic manufacturer of x86 architecture CPU, and the CPU and DCU continue to upgrade, maintain the increase-A recommendation.

4. Leanlon (stock code: 300596)

The company belongs to the plastic products industry. On January 2, 2024, Leanlong announced that it intends to increase its capital to Yixing Chuangju with its own funds of 0.2 billion yuan. After the completion of the capital increase, the company will hold 51.18 percent of the equity of Yixing Chuangju, Yixing Chuangju will wholly acquire 100 percent of the equity of Korea IPI, after the completion of the transaction, Yixing Chuangju will become the company's holding subsidiary, Yixing Chuangju and Korea IPI will be included in the scope of the company's consolidated statements. ·

In response to the above events, this week, we have selected research reports from analysts from two institutions, Guohai Securities and Open Source Securities.

Share price movement this week:

closing price on January 5: 30.95 yuan, with the stock price up 4.70 percent this week.

1. Institutions: Guohai Securities

Analysts: Li Yonglei, Dong Bojun, Yang Lirong

Rating: Buy

Research Summary:

1) intends to acquire Korea IPI to enter the electronic grade PI material market. Polyimide film and slurry materials belong to the "card neck" import substitution class electronic grade PI materials. South Korea's IPI company has mature mass production products FCCL with TPI film and QFN packaging with TPI film, Film heater, as well as mass production-based YPI products using harmless solvents, and the products have been verified by Samsung Electronics, Lianmao Electronics and other companies, and has been supplied in bulk. This time the company increased its capital to Yixing Chuangju by 0.2 billion yuan. The funds are mainly used in two aspects: ① for Yixing Chuangju's acquisition of 100% equity consideration and related taxes and fees of Korea IPI; ② The remaining capital increase will be used for Yixing Chuangju to build YPI production line and TPI coating line. China's production capacity and R & D center will be rapidly built in Yixing, Jiangsu, forming a parallel R & D and production pattern of South Korea's R & D center and China's R & D center. Through this acquisition, the company is expected to quickly enter the high-end electronic chemicals business, and gradually extend to the upstream core materials industry used in the manufacture of flexible OLED display screens and flexible circuit boards (FPC), chip packaging and power batteries.

2) New production capacity into the release period, diversified layout to promote development. According to the company's 2023 mid-year report, Kangtai Phase II 50000 tons/year lubricant additive has completed trial production, Kangtai Phase II production capacity release in the immediate, is expected to fill the first phase of the product short board, the first phase and the second phase of the project capacity to form a joint force. In addition, the company has laid out the fields of life science and synthetic biology, with an annual output of 6 tons of nucleic acid monomer pilot production, and the pilot production samples have passed downstream verification. Salidroside has completed the ton-level pilot scale-up and has the conditions for industrialization. Polyglutamic acid has completed the development of 100L fermentation, separation and purification process and has met the conditions for pilot scale-up. Projects such as hyaluronic acid and special amino acids and their derivatives have completed technology introduction, and are currently undergoing technology verification and fermentation separation and purification process optimization.

3) earnings forecast and investment rating: affected by the industry boom fluctuations, the company's anti-aging additives industry downstream demand is weak, product prices have declined, superimposed on the company's Kangtai Phase II pre-trial production cycle is longer than expected, capacity release progress is lower than expected, we adjust the company's performance. Based on the principle of prudence, regardless of the impact of this acquisition on the company's performance, it is estimated that the net profit attributable to the parent company in 2023/2024/2025 will be 3.81, 4.95 and 0.649 billion yuan respectively, and EPS will be 1.66, 2.15 and 2.82 yuan/share, corresponding to PE of 19, 14 and 11 times. We are optimistic that the company's new projects in the past two years into the capacity of the centralized release period, overlay the company's forward-looking layout of life sciences and high-end electronic materials, maintain a "buy" rating.

2. Institutions: Open Source Securities

Analysts: Jin Yiteng, Xu Zhengfeng

Rating: Buy

Research Summary:

1) the company plans to acquire Korea IPI to enter the electronic polyimide industry and the high-end electronic chemicals industry. the company announced that it plans to increase its capital to Yixing chuangju with its own capital of 0.2 billion yuan. after the capital increase is completed, the company will hold 51.1838 percent of Yixing chuangju, and Yixing chuangju will wholly acquire 100 percent of the equity of Korea IPITECH INC.(Korea IPI). Upon completion of the transaction, Yixing Chuangju will become a holding subsidiary of the Company, and Yixing Chuangju and Korea IPI will be included in the scope of the Company's consolidated financial statements. Considering that mergers and acquisitions are still in progress and new projects are still in progress, we maintain the company's earnings forecast, the expected 2023-2025 net profit of 4.10, 5.73, 0.707 billion yuan, EPS were 1.79, 2.50, 3.08 yuan/share, the current share price corresponding to PE of 16.6, 11.9, 9.6 times. We are optimistic that the company will continue to consolidate anti-aging additives, lubricant additives and life sciences, and through mergers and acquisitions quickly cut into polyimide (PI) and other electronic chemicals, to achieve multi-level high-quality development, maintain a "buy" rating. South Korea IPI production technology and mass production process mature, the company intends to layout China and South Korea double research and development double production base.

2) according to the company's announcement, the founding team of IPI in south Korea has more than 10 years of research and development and application experience in PI field. at present, IPI has mature mass production products such as TPI film for FCCL and TPI film for QFN packaging, Film heater, YPI products with mass production basis using harmless solvents, and several other technologies and product direction reserves. its products have been verified by Samsung electronics, lianmao electronics and other companies, and has begun to bulk supply. No more than 0.2 billion of the capital increase funds obtained by Yixing Chuangju will be used to pay the consideration and relevant taxes for acquiring 100% equity of Korea IPI, and no more than 0.02 billion shareholder loans will be provided to Korea IPI for it to repurchase and cancel the preferred shares of Korea IPI held by Korea Industrial Bank. The remaining capital increase funds will be used for Yixing Chuangju to build YPI production line and TPI coating line and supplement the working capital of Yixing Chuangju and Korea IPI. The project will rapidly build China's production capacity and R & D center in Yixing, Jiangsu Province, forming a parallel R & D and production pattern of Korean R & D center and Chinese R & D center, Korean production capacity and Chinese production capacity. We believe that the company actively promote anti-aging additives, lubricant additives and other new capacity release, 2023Q2-Q3 revenue, home-to-home net profit are improved month-on-month. With the realization of this transaction and Yixing Chuangju, Korea IPI resource integration, cut into the high-end electronic materials industry, the company's profitability is expected to continue to improve, multi-level high-quality development pace of steady.

5. Yongtai Energy (stock code: 600157)

The company belongs to the electric power industry. On January 1, 2024, the company issued a pre-increase announcement for its 2023 annual performance. It is estimated that the net profit attributable to shareholders of listed companies in 2023 will be 2.23 billion to 2.33 billion yuan, an increase of 16.80 compared with the same period of the previous year (statutory disclosure data)% ~ 22.04; the net profit attributable to shareholders of listed companies after deducting non-recurring gains and losses is 228000~2.38 billion yuan, an increase of 36.97~42.97 compared with the same period last year (statutory disclosure data).

In response to the above events, this week, we have selected research reports from analysts from both Capital Securities and Open Source Securities.

Share price movement this week:

closing price on January 5: 1.38 yuan, with the stock price up 0.73 percent this week.

1. Institutions: First Securities

Analyst: Zhang Fei

Rating: Overweight

Research Summary:

1) The overall performance of coal production and sales growth remained stable, and the mine under construction was progressing smoothly. In 2022, the company completed the acquisition of Yinyu Coal Mine and Fujuyuan Coal Mine in Gujiao Area of Shanxi Province, increasing the production capacity by 1.2 million tons/year, laying the foundation for the company's production and sales growth. According to the company's announcement of the company's operating data for the first three quarters of 2023, the company realized 954.03/9.5942 million tons (+15.67/17.68) of raw coal production and sales in the first three quarters, of which 247.85/2.4402 million tons (-1.63/-2.35) of washed coal production and sales were respectively, and the steady growth of production and sales drove the company's performance growth. The company's coal project under construction in Haizetan Coal Mine in Yulin, Shaanxi Province, as of December 31, A total of 2,168 meters of wells have been built in the four shafts, and the overall project progress is one month ahead of schedule. It is expected that on January 20, 2024, the central return air shaft will reveal the main coal seam and dig it to the end. In May, it will be turned flat and will enter the second phase of construction. The conditions for coal production will be available in the third quarter of 2026 and production will be reached in 2027. The project will be put into operation in the future will significantly increase the company's coal production capacity, improve the level of medium-and long-term profitability.

2) The cost of the power business sector decreased year-on-year, significantly turning losses to drive year-on-year growth in performance. In the first three quarters, the company generated 28.3 billion kWh (+0.57 per cent) of electricity and sold 26.81 billion kWh (+0.45 per cent) of electricity. According to wind data, the annual average closing price of large-scale thermal coal 5500 in Qinhuangdao in 2023 was 965.03 yuan/ton, a year-on-year decrease of 17.24 percent from the average price of 1166.03 yuan/ton in 2022. In terms of the average price of long-term cooperation, the average price of long-term cooperation in 2023 was 713.83 yuan/ton, a year-on-year decrease of 1.09 percent from 721.67 yuan/ton in 2022. The company's power sector raw material costs in 2023 year-on-year reduction, profit than 2022 is expected to achieve a significant reduction in losses and even is expected to turn a profit, driving the company's full-year results to achieve a pre-increase.

3) The construction of energy storage projects is progressing steadily and orderly. Orderly promotion of the construction of energy storage production line, the company's Dunhuang Huihong Mining Development Co., Ltd. 6,000 tons/year high purity vanadium pentoxide smelting production line (phase I 3000 tons/year) and 1000MW vanadium redox flow battery energy storage equipment manufacturing base (phase I 300MW) have been started at the end of June 2023, the first phase of the project is expected to be put into operation in the second half of 2024, will occupy about 20% of the current domestic market share of vanadium from stone coal production. Downstream vanadium battery production project, the 1,000MW all-vanadium redox flow battery energy storage equipment manufacturing base (Phase I 300MW) of Zhangjiagang Detai Energy Storage Equipment Co., Ltd., a subsidiary of the company, has started construction as scheduled at the end of June 2023. The first phase of the project is expected to be put into production in the second half of 2024 and will occupy about 10% of the domestic market share after reaching production. The steady progress of energy storage projects will accelerate the rapid transformation of the company's new energy direction.

4) earnings forecast and investment rating: the company's net profit for 2023-2025 is expected to be 23.1/23.3/2.37 billion yuan respectively, and the current share price corresponds to PE of 13.2/13.0/12.8 times. Considering the company's coal power integration, stable operation, coal production capacity growth there is room to maintain the company's increased rating.

2. Institutions: Open Source Securities

Analyst: Zhang Xucheng, Tang Yue

Rating: Overweight

Research Summary:

1) 2023 results are expected to increase significantly year-on-year, focusing on energy storage and new coal mines, maintaining an "overweight" rating. The company issued the 2023 annual report forecast, 2023 to achieve the return of net profit of 22.3-2.33 billion yuan, 16.8-22.0% YoY, the realization of non-return net profit of 22.8-2.38 billion yuan, 37.0-43.0% YoY. Single Q4, 2023Q4 to achieve home-to-home net profit of 6.1-0.71 billion yuan, month-on-month -0.8-15.5%, to achieve non-return-to-home net profit of 6.6-0.76 billion yuan, month-on-month -8.1-24.4%. The company's performance is expected to increase mainly due to the year-on-year increase in coal business production and sales, the power business thermal coal procurement costs decreased year-on-year, the current coal prices are relatively high and the amplitude narrowed. We maintain the profit forecast for 2023-2025 and expect to realize a net profit of 23.0/25.1/2.66 billion yuan from 2023-2025, up +20.4/9.3/+5.8 year on year. EPS is 0.10/0.11/0.12 yuan, corresponding to the current stock price PE of 13.3/12.2/11.5 times, maintaining the "overweight" rating.

2) Coal production and sales growth overlaid with lower electricity costs and significant performance improvement. Coal business: the company's coal business production and sales increased in 2023, of which the first three quarters of raw coal production/sales of 954/9.59 million tons, year-on-year +15.7%/+17.7%, the fourth quarter is expected to produce and sell little change from the third quarter. In 2023, the average price of 5500 large-card thermal coal in Qingang was 965 yuan/ton, down 24.0 percent from the same period last year, while the average price of main coking coal (Shanxi) warehouse in Jingtang Port was 2283 yuan/ton, down 19.6 percent from the same period last year. The increase in production and sales of the company's coal business to some extent hedged the impact of the decline in market coal prices. Electricity business: in terms of cost, the company's power generation cost has been greatly reduced due to the more correction of coal price. In terms of volume, the company's electricity sales have improved. In the first three quarters, the company generated/sold 283/26.8 billion degrees of electricity, up +0.6/0.4% year on year, of which Q3 generated/sold 112/10.6 billion degrees, up +35.1/35.2% month on month. In terms of price, the average electricity price in the first three quarters was 476 yuan/megawatt-hour, up 2.6 year-on-year. The company's power sector improved significantly in 2023, and the company said its power business began to turn a profit in May.

3) The all-vanadium liquid flow battery project accelerated landing, and other energy storage projects expanded simultaneously. Accelerate the layout of the whole industry chain of the whole vanadium flow battery, the company's energy storage transformation accelerated landing. ① Construction of all-vanadium redox flow battery project: the first phase of 300MW large-capacity all-vanadium redox flow battery production line started construction on June 27, the pile foundation project was completed in September, and it is expected to be put into operation in the second half of 2024, of which the 1MW test production line has been installed and debugged, and the first phase of the project is expected to account for 10% of China's market share after delivery. In addition, the 30MW all-vanadium redox flow battery energy storage auxiliary frequency modulation demonstration project of Shazhou Power Phase II is planned, and the project design and bidding for the main equipment of the energy storage system have been completed. The construction of vanadium ore dressing and smelting production line: on June 29, Huihong Mining Phase I 3000 tons/year high-purity vanadium pentoxide dressing and smelting production line started construction, is expected to be put into operation in the second half of 2024, up to about 20% of China's share after delivery. The company plans to build a total of 2 x 3000 tons/year, with the gradual development and utilization of vanadium, the value of the company's vanadium ore resources highlighted.

4) The construction of Haizetan accelerated, the fifth time executives increased their holdings to show confidence. The Haizetan coal mine project is expected to produce coal in 2026. The company's Shaanxi Yihua Haizetan Coal Mine Project is located in Yuheng Mining Area, Shaanxi Province. The coal types are mainly high-quality chemical coal and thermal coal, with resource reserves of 1.145 billion tons and an average calorific value of more than 6500 kcal. As of December 31, 2023, the overall progress of the project is one month ahead of schedule, and the conditions for coal production are expected in 2026. The project can reach a production capacity of 10 million tons/year of high-quality chemical coal and thermal coal. The net profit is about 4.2 billion yuan based on the market coal price in the past three years, and the net profit is about 4.4 billion yuan based on the average market coal price in 2023. Executives have repeatedly increased their holdings to demonstrate confidence. In October 2023, the company announced the completion of the fifth increase in the company's stock plan by the core management personnel, this total increase of 0.09, showing the company's management's confidence in the company's development.