玖龙纸业（02689.HK）启动永续债回购以降低融资成本，包装纸淡季提价顺利

Papermaking Launching perpetual bond buyback to reducefinancing costs; packaging paper off-season price ND PAPER (2689.HK) Key takeaway The company has secured a RMB2bn syndicated loan andlaunched a perpetual bond buyback tender offer. It willrepurchase in cashUSD400mn in principal amount of 14%seniorperpetual capital securities. The company's chairperson Ms.Zhang Yin and related holders (collectivelyholding 81% of theperpetual bonds) have committed to the company to tendertheir securities for buyback after the early-bird period(receivingthe standard buyback consideration). This buyback will help savenearly RMB300mn in interestcosts, enhance net profit MaintainOverweight YE Leyele@csc.com.cn18521081258SAC Reg. No.: S1440519030001 Current price:HKD7.33 Event ND PAPER launches perpetual bond buyback tender offer. The company announced the launch of a cash tender offer torepurchase any and all of its outstanding USD400mn 14% seniorperpetual capital securities, aiming to furtherenhance its ND PAPER announces securing of syndicated loan.Thecompany's board of directors announced that it has entered intoa loan agreement with certain banks (as lenders), providing a Quick Take Ms. Zhang Yin and related holders (holding 81% of the perpetual bonds) have committed to the companyto tender their securities for repurchase after the early-bird period, opting to receive the standardrepurchase consideration.The company has set anearly-bird periodfor this buyback. If securities are tenderedand accepted by the company on or before 4:00 p.m. (London time) on June 26, 2026, holders will receiveUSD1,070 per USD1,000 in principal amount, plus any accrued and unpaid interest. If tenderedafter 4:00 p.m.(London time) on June 26, 2026, but before 4:00 p.m. (London time) on July 3, 2026, holders will receive The buyback of the perpetual bonds will help reduce financing costs and optimize the company's capitalstructure.These perpetual bonds were issued in June 2024, with a principal of USD400mn and an annualinterest rate of 14%, generating perpetual bond interest of RMB400mn and RMB201mn in FY25 and FY26H1,respectively. The funding source for the company's buyback of the perpetual bonds is a RMB syndicated loancombined with internal funds. We expect this to significantly reduce the company's financing costs (according to Supported by costs, packaging paper prices rose during the off-season, with the supply-demand structure continuing to optimize over the long term.The company primarily produces packaging papergrades, with packaging paper revenue accounting for 89% of the total. Since late May,large-scale paperenterprises such as NDPAPER and Shanying Paperhave beensuccessively raising prices for some corrugatedmedium and linerboard products and conducting maintenance shutdowns from late May to early June.Smalland medium-sizedpaper enterprises followed suit with price hikes,and themarket atmosphere for price supportcontinued to intensify.According to SCI, as of June 12, 2026, linerboard, corrugated medium, and waste yellowboard prices were RMB3,735, RMB3,029, and RMB1,763 per tonne, respectively, up RMB218, RMB362, and The subsequent focus of expansion will be on increasing self-produced pulp capacity to consolidate thecompany's leading competitive advantage.Future planned expansion projects only include 2.5mn tonnes ofchemical pulp capacity (Chongqing 700k and Tianjin 500k in 26Q4; Beihai 800k in 27Q2; Dongguan 500k in27Q3), with no new paper capacity planned. We expect FY26 capex to drop to RMB12.5bn (from RMB14.8bn in Investment recommendations:We forecast ND PAPER's revenue for FY26-28 to be RMB73.263bn,RMB77.601bn, and RMB79.952bn, representing YoY growth of 15.8%, 5.9%, and 3.0%. Net profit attributable toshareholders of the parent company is projected at RMB3.539bn, RMB4.638bn, and RMB5.061bn, representing Risks: 1) Downstream demand lower than expected.As a leading enterprise in the domestic paper industry,the company holds a high market share in containerboard and coated duplex board capacity. Its downstreamsectors are primarily consumer packaging and printing; weak downstream demand would adversely impactrevenue and profitability.2) Wood chip price increases higher than expected or wood pulp prices YE Le Analyst Serving as the Chief Analystfor Textile/Apparel,Light Industry and Education,hegraduated from Fudan University with a Master of Finance. He was honored as the BestAnalyst in the Textile and Garment industry by the "Golden Bull Awards" in both 2024and 2025, while also earning the 2025 "Golden Kirin" Best Analyst title for Light Industry Disclaimer This report is a translation of the original Chinese report[玖龙纸业(2689):启动永续债回购降低融资成本，包装纸淡季提价顺畅],released on[16June2026]. If there is anyinconsistency or ambiguity between the English version andthe Chinese version, the Chinese version shall prevail. Analyst Certification Each analyst of this report hereby certifies that: (i) the report is produced indep