Inquiry conclusion
It is estimated that the EPS of the company in 10-12 years will be 0.75,0.95,1.40 yuan, corresponding to the 10-year forecast PE of Hong Polaroid, Zhejiang Longsheng and other chemical sub-industries such as fine chemicals, dyes, inks and so on. We believe that the company's 2010 price-to-earnings ratio of 28-35 times is more appropriate, based on the company's 2010 earnings per share of 0.75 yuan, the company's reasonable share price should be 21-26 yuan. After giving a 10% discount, the reasonable share price should be 18.9-23.4 yuan.
Main basis
Technical advantages: the process route adopted by Baichuan Chemical Industry has the advantages of good product quality, low production cost and low investment cost, and is in a leading position in China. For butyl acetate: the company adopts the process of combining liquid acid catalyst with reactive distillation, which can reduce the energy consumption of butyl acetate production by about 30%. Trimellitic anhydride: the company has accumulated rich experience in product production and construction, so that the investment cost of the same production scale construction is significantly lower than the average level of the same industry, and the competitiveness of products is very prominent.
The cost advantage is obvious: the company is currently a leading manufacturer of butyl acetate and trimellitic anhydride in China: large-scale industrial production makes the company have a strong cost advantage in project construction and raw material procurement: the company produces trimellitic anhydride and trimellitic acid trioctyl ester at the same time, the company is more complete than other production enterprises in the same industry in terms of industrial chain. It also has obvious advantages in production costs: Baichuan Chemical produces trimellitic anhydride, the main raw material, and the production cost is about 15% lower than the average market price. As a result, the production cost of trioctyl trimelliate per ton is about 820 yuan lower than that of enterprises in the same industry, and the gross profit margin can be increased by about 5 percentage points.
Industry segmentation leader: the company has a market share of about 30% in butyl acetate and nearly 20% in trimellitic anhydride.
However, at present, there is overcapacity in butyl acetate and trimellitic anhydride industry, which hinders the company's future performance growth.