Benefiting from the downstream demand for white power, the company continues to adhere to the DMS (design, production, service) business model with industrial design as the core, seizing the opportunity of the rapid development of the white power industry. while consolidating the leading position of TV appearance structure, the sales revenue of white power structure products has increased significantly. In 2010, the total domestic output of color TV sets, air conditioners, refrigerators and washing machines was 119.3778 million, 112.1986 million, 75.4603 million and 62.0813 million respectively, an increase of 12.93%, 41.59%, 26.94% and 27.14% respectively over the same period last year. The overall growth trend of the downstream home appliance industry of the company ensures the growth of the company's business income.
The proportion of sales revenue of high gross margin products to the main business income of the company has not changed significantly, but its structure has changed greatly. As the company has stepped up its efforts to expand its customers, the sales revenue of Baidian's structural products has increased by 617.69% over the same period last year, and its sales revenue accounts for 20.23% of the main business income, up from 3.31% in the same period last year. Gross profit margin also increased to 17.60%. The proportion of sales revenue of black electricity structure products in the main business income decreased to 76.43% from 90.15% in the same period last year. The product structure has changed, and the proportion of sales revenue from high gross margin products to the main business income has increased: among TV appearance structure products, the proportion of CRT TV appearance structure sales with low gross margin has dropped to 2.76% from 12.03% in the same period last year; the company has strengthened the cross-industry penetration of the DMS model.
The order of "fixed production by sales" is stable, and the bargaining power is strong. During the reporting period, the market prices of the main raw materials (modified plastics, sheet metal structures) used by the company increased greatly, and the sales prices of the company's main products increased with the rise of the prices of major raw materials. The company's products and its sales model determine that the company is basically "fixed production by sales", that is, arrange the production plan according to the customer's order. The confirmation, change or cancellation of the order is strictly restricted by the terms of the contract, and the company's main customers are well-known TV sets, white power and automobile manufacturers at home and abroad, with good credit, through long-term cooperation, the company has established a stable relationship between supply and demand, and maintain a certain bargaining power. Therefore, the quantity and amount of the company's product orders are basically the same as the sales volume and sales income of the product, and the production cycle of the company's order is relatively short, usually about 20 days, and the time from delivery to order confirmation is relatively short. therefore, there is basically no inter-temporal implementation. The company's comprehensive sales gross profit margin was 19.21%, which was basically the same as the same period last year. Although the price of the main raw materials used in the company's production and the cost of human resources have increased significantly this year, the company has ensured the stability of the gross profit margin by raising prices, adjusting the product and income structure, and reducing the cost of technology and design.
DMS mode the company's DMS model will integrate the whole process of design and manufacturing of plastic and sheet metal structural parts, including industrial design, structural design, mold development, plastic research to injection molding, spraying, assembly, sheet metal, process improvement, etc., to provide home appliances and automobile customers with systematic solutions for modular structural components.
The appearance structure with rapid response ability based on efficient development, scale manufacturing and nearby matching is a link with fast change and high speed in the whole machine industry. the company's efficiency advantage from design to mass production has become an important advantage for the company to maintain a leading position in the industry. Compared with traditional companies that only provide individual services, the company's model reduces the links of negotiation, decision-making, communication, docking, etc., so that the whole development cycle (from product conceptual design to mass production) is reduced from the traditional 3-6 months to 55 days (currently the common level of domestic enterprises in the same industry is 3-6 months), laying a solid foundation for increasing market share.
The risk suggests that the price of modified plastics and sheet metal structural parts, the main raw materials of the company's products, still fluctuates sharply; in the downstream TV industry of the company, domestic enterprises are not yet able to control the upper reaches of the liquid crystal industry chain, resulting in foreign brands squeezing the market share and profit space of domestic brands through price reduction and promotion. Although from the strength of the price reduction of foreign brands, the space for further price reduction is limited, it does not rule out the possibility that foreign enterprises will continue to use price reduction to compete with domestic enterprises in 2011. As the company's main customers are domestic enterprises, if this competition intensifies, it will threaten the gross profit space of the company's products.
Earnings forecast 2011, 2012, 2013 earnings per share is expected to be 0.42,0.51,0.62 yuan, taking into account the company's future performance growth expectations and industry conditions, we think that according to 2011 29 times PE is more reasonable, give the company "overweight" rating.
