The company lost money in the middle of 2009, and the loss in the second quarter (about 5.1 million) was less than that in the first quarter (6.9 million). The main products are inorganic barium salt, strontium salt and electrolytic manganese dioxide used in CRT glass shell and primary battery respectively, and reached rock bottom in the first half of 2009.
The income of inorganic barium salt and strontium salt in 2009H1 decreased by 46%, and the gross profit margin decreased by 7.03%.
Since 2009, the traditional CRT industry has accelerated its decline, which has brought pressure on the sales of inorganic barium salt and strontium salt, especially the consumption structure of strontium salt is more concentrated in the field of CRT glass shell. Glass shell demand is gradually shrinking, the company's traditional barium salt, strontium salt is facing the transformation of the demand field.
The manganese salt industry mainly includes electrolytic manganese dioxide and manganese ore products. In 2009H1, revenue decreased by 2.6% and gross profit margin increased by 36.94%. The increase in profitability is mainly due to a 36.38% drop in production costs. The promotion of new power vehicles will provide a broad demand space for the company's electrolytic manganese dioxide.
Guizhou Rongguang Mining Company, which is 50% owned by the company, will start production of 900000 tons of coal by the end of 2009. Wanshan Manganese Mine, which has a 70% stake, is expected to start production in the second half of 2009, and short-term production will depend on the demand for electrolytic manganese dioxide.
We estimate that the asset value of the company is 12.88 yuan per share, which belongs to the type with high PE and high implied asset value. We believe that the current stock price does not fully reflect the asset value, the important investment attraction is that driven by the new power vehicles, electrolytic MnO2 is expected to become an "engine" business. The company's existing barium salt, strontium salt, electrolytic MnO2 production technology and product development direction all represent the industry trend, reflecting the higher management and technical level, we are optimistic about its future development prospects. Maintain the "overweight" rating.
