HK Stock Market Move | CHINA XLX FERT (01866) rose more than 4% in the morning. The company is expected to achieve a year-on-year increase in net profit of 41% to 52% in the first quarter.

China XLX FERT (01866) rose more than 4% in the morning session, rising 3.88% to HK$11.78 as of the time of writing, with a turnover of HK$30.5729 million. In terms of news, China XLX FERT reported a profit for the first quarter, expecting revenue of 6.7 billion to 7 billion yuan, a year-on-year increase of 15% to 20%; net profit attributable to shareholders was 280 million to 300 million yuan, a year-on-year increase of 41% to 52%. The company stated that the significant increase in performance was mainly due to the simultaneous increase in the quantity and price of core products, leading to an overall increase in gross profit. In the article "Cyclical Rebound Combined with Capacity Release, Profit Center Expected to Shift Upwards - China XLX FERT (01866) Valuation Revaluation Accelerating," it is pointed out that the heartwarming profit recovery is not a one-time pulse, but a combination of capacity cycles and economic cycles - projects are completed during the industry's low period, coinciding with the concentrated release during the upswing, forming a "operating leverage" effect where profit growth far exceeds revenue growth. What is even more worth noting is the shift in valuation logic. In the past, the fertilizer industry was seen by the market as a typical cyclical sector, with investors accustomed to pricing at 5 to 8 times PE. However, the uniqueness of this round of the market lies in the fact that the industry is transitioning from being "price-driven" to "value-driven".