Analysis of Limin Co., Ltd. (002734.SZ): 661% Net Profit Growth and Operational Efficiency

Based on the collected data and analysis, we now present an in-depth analysis report on Limin Co., Ltd. (002734.SZ) regarding its 661% net profit growth alongside an 8% headcount reduction.

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Limin Co., Ltd. recorded net profit attributable to parent company shareholders of RMB 390 million in the first three quarters of 2025, representing a substantial year-on-year increase of 661.66%. Notably, this growth shows distinct quarterly fluctuations:

• Q1 2025: Net profit surged 1373% year-on-year (due to base effect)
• H1 2025: Net profit increased 782% year-on-year
• First three quarters of 2025: Net profit rose 661% year-on-year[1]

During the same period, the company’s total employee headcount decreased by approximately 8%, mainly achieved through natural attrition and position optimization[1].

According to industry data, the prices of the company’s main products have been on a continuous upward trend since March 2024[2]:

Product	Price Change	Growth Rate
Emamectin Benzoate	RMB 500,000/ton → RMB 715,000/ton	+43%
Abamectin	RMB 350,000/ton → RMB 515,000/ton	+47%
Mancozeb	RMB 23,500/ton → RMB 25,000/ton	+6.4%
Chlorothalonil	Starting from RMB 18,000/ton	Upward

The improved performance of the company’s affiliated entities has contributed significant investment income, emerging as another key source of net profit growth[1].

The 8% reduction in headcount has led to a direct decrease in labor costs, but this factor has relatively limited contribution to net profit growth.

Assuming uniform distribution of employee efficiency, the 8% headcut combined with 661% net profit growth implies an approximate 727% increase in profit per employee.

The stock price rose from RMB 8.20 at the beginning of 2024 to RMB 16.83 at the start of 2026, representing a cumulative increase of 105% during the period, with a peak of RMB 24.87 reached on June 12, 2025. The current stock price is fluctuating around the 50-day moving average (RMB 17.00) and 20-day moving average (RMB 16.20)[0][3].

1. Sustainability of Product Price Hikes (Risk Score: 90/100)
   • Pesticide prices are significantly affected by supply and demand in the global agrochemical market
   • This round of price hikes mainly stems from the end of the global agrochemical destocking cycle, rather than sustained improvement on the demand side[2]
   • If downstream inventory replenishment is completed, there is significant risk of price correction

2. Volatility of Investment Income (Risk Score: 65/100)
   • The performance of affiliated entities is uncertain
   • Fluctuations in investment income may affect future profit stability

3. Demand-Side Stability (Risk Score: 75/100)
   • Agricultural demand is relatively rigid, but cyclical fluctuations exist
   • Uncontrollable factors such as extreme weather and the severity of plant diseases and insect pests

4. Sustainability of Cost Control (Risk Score: 70/100)
   • The room for workforce optimization is already limited
   • There is still pressure from raw material and energy costs

5. Industry Competition Landscape (Risk Score: 55/100)
   • The pesticide industry is highly competitive, with increasing concentration among leading players[2]

• Trend Judgment:
  The stock price is currently in a sideways consolidation phase, with no clear trend signals[3]
• Beta Coefficient:
  0.65 (relative to the Shenzhen Component Index), with relatively low volatility
• Support Level:
  RMB 16.20 (20-day moving average)
• Resistance Level:
  RMB 17.06 (short-term resistance level)
• Annualized Volatility:
  Currently around 29.55%, which has declined from previous highs

The growth momentum is expected to continue, but caution is needed regarding seasonal price correction pressure for products. The company’s current PE (TTM) is 17.62x, with valuation at the historical central level[0].

The sustainability of growth depends on: ① Whether main products can maintain current price levels; ② New order status; ③ Performance of investment income. Guosen Securities forecasts that the company’s net profit attributable to parent company shareholders will be RMB 402 million, RMB 478 million, and RMB 522 million for 2025-2027 respectively[2].

The sustainability of the current growth model is questionable. The company needs to: ① Expand new product lines; ② Increase market share; ③ Strengthen cost control capabilities to maintain profitability.

Pesticide price fluctuations, changes in industry policies, exchange rate fluctuations, and performance fluctuations of affiliated entities

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[1] Sohu Securities - Limin Co., Ltd. Performance Forecast and Company Profile (https://q.stock.sohu.com/cn/002734/yjyg.shtml)

[2] Guosen Securities - Research Report on Limin Co., Ltd. (002734.SZ) (http://pdf.dfcfw.com/pdf/H3_AP202505261679298130_1.pdf)

[0] Jinling AI - Market Data and Technical Analysis

[3] Jinling AI - Technical Indicator Analysis of Stock Price K-line Chart