Event: 1) the company issued a "prospectus for the public offering of convertible bonds", and the convertible bonds raising 500 million yuan will formally apply for purchase on November 25. 2) the company announced that it signed an investment agreement with the Management Committee of Luzhou High-tech Industrial Development Zone on November 22, 2022. The agreement stipulates that Changjiang Machinery, a wholly owned subsidiary of the company, will be responsible for investing in the construction and operation of the "key parts production base project for new energy vehicles", with a total investment of no more than 550 million yuan.
500 million convertible bonds will be issued and listed soon, which will help the differential project proceed smoothly. According to the "prospectus for public issuance of convertible bonds", the convertible bonds rated as AA-; raised 500 million yuan, of which 350 million will be used for the construction of automobile differential assembly production base and 150 million will be used to supplement liquidity. The convertible bonds will be placed and purchased online on November 25, with a maturity of six years from that date (that is, from November 25, 2022 to November 24, 2028). The coupon is 0.30% in the first year, 0.40% in the second year, 0.80% in the third year, 1.50% in the fourth year, 2.00% in the fifth year and 2.50% in the sixth year, and the conversion period is from June 1, 2023 to November 24, 2028. We believe that the issuance of convertible bonds will effectively alleviate the financial pressure of the company and promote the smooth progress of the company's 5 million sets of differential projects.
Invest 2 million motor shaft projects to create new growth points. According to the announcement, the company plans to invest no more than 550 million yuan to build an annual production capacity of 2 million new energy vehicle motor shafts. The project is expected to be completed in October 2024, and Changjiang Machinery, a wholly owned subsidiary, is in charge of the project. We are optimistic about the project: on the one hand, the motor shaft is the core component of the powertrain of new energy vehicles, and the implementation of this investment project will help to enrich the related products of new energy vehicles. Accelerate the expansion of the company's new energy vehicle business, improve the company's existing automobile industry layout, enhance the company's business scale and profitability, promote the company's sustainable development, in line with the company's strategic investment plan On the other hand, the company's investment is hollow motor shaft, compared with the traditional solid shaft, the weight is greatly reduced, which is the inevitable path of motor lightweight in the future, but also an important direction to improve the performance of electric drive. With the rapid development of new energy vehicles, the company will further deepen and expand cooperation with BYD, Dana, Geely and other customers in new energy vehicle products with the help of differential business, so as to bring new profit growth points for the company. according to the estimate of 150-200 yuan per piece, the income of this investment will reach 300 million to 400 million yuan.
Profit forecast and investment advice. Homing net profit is expected to maintain a compound growth rate of 37.4% over the next three years, with PE in 22-24 times that of 19-13-9, maintaining a "buy" rating.
Risk tips: motor shaft project schedule is not as expected risk; new business development is not as expected risk; epidemic risk; chip shortage risk; exchange risk.