The annual report results are in line with expectations. In 2010, the company achieved sales revenue of 2.703 billion yuan, an increase of 30.27% over the same period last year. The net profit belonging to shareholders of listed companies was 276 million yuan, an increase of 2.92% over the previous year, and the fully diluted EPS was 0.69 yuan, which was fully in line with expectations. At the same time, the company intends to distribute RMB 1.50 (including tax) cash dividend to all shareholders for every 10 shares.
The level of gross profit has increased significantly, and the industry has made a comeback in 2011. The company's annual comprehensive gross profit margin has risen to 17.45% from 14.96% in half a year, and the comprehensive gross margin level has bounced up sharply to 19.48% in the second half of the year. In the second half of the year, the gross profit margin of the company's main oil casing products has reached 20.64%, and the gross profit per ton has exceeded 1200 yuan, returning to the level at the peak of the boom in 2008, which is in line with our judgment that the industry will return to prosperity in 2011.
Domestic customers have risen steadily, while overseas customers have gained more. On the basis of stabilizing the two major domestic customers, Petrochina Company Limited and China Petroleum & Chemical Corp, the company continues to expand its cooperation with CNOOC, with a cumulative sales of 41.72 million yuan in 2010 and is expected to exceed 100 million yuan in 2011. Overseas market companies have newly developed customers such as Sudan SUMASU, Stevens, CORPAC, France TFE, Marubeni, Korea LG, Singapore Midland and Hong Kong Sanwa Oil. We expect the company's overseas market sales to exceed 200000 tons in 2011.
Continue to increase the research and development of new products and increase the proportion of high-end products. In the future, the company will continue to increase the research and development of new products such as high collapse resistance + H2S corrosion resistance casing, CO2 corrosion resistance casing, API acid service pipe, special buckle casing serialization, suspended monomer pillar pipe and petroleum cracking pipe, etc., which meet the requirements of Canadian Directive010 for acid environment, special outer diameter coupling tubing, special external diameter coupling tubing, special outer diameter coupling tubing, special outer diameter coupling tubing, special external diameter coupling tubing, special outer diameter coupling tubing, special external diameter coupling tubing, special external diameter coupling The proportion of high-end products is expected to rise to about 60% in 2013.
Maintain the "overweight" rating. We estimate that the company's EPS in 2011-2013 will be 1.01,1.33 and 1.56 yuan respectively, and the current price corresponding to PE is 22 times, 17 times and 14 times respectively. The company will be given 30 times PE in 2011, with a target price of 30.3 yuan, maintaining the "overweight" rating.