Event: the company plans to issue new shares on the Shenzhen Stock Exchange on October 24, 2014.
Main points of investment
The company is the leader of domestic ethylene oxide fine chemical industry. The company's products are divided into three categories: polyether monomer, crystal silicon cutting liquid and polycarboxylic acid superplasticizer. Among them, polyether monomer company ranks second in the domestic market, polycarboxylic acid superplasticizer also ranks second in the domestic market, and crystal silicon cutting fluid ranks about fifth in the domestic market.
The company is one of the largest companies in China with a complete vertical industrial chain from polyether monomer to polycarboxylic acid pumping agent. The company successfully developed methyl alkene polyether monomer to fill the domestic blank, the company's shrinkage-reducing polycarboxylic acid superplasticizer broke the monopoly of foreign products in this field and participated in large-scale projects such as Wenfu Railway, Harbin-Dalian Railway and Changchun West Railway Station. the company is one of the few enterprises in China with mature production technology of solar crystal silicon cutting liquid.
The downstream of superplasticizer is mainly concrete projects of large-scale projects, and the future development space may be restricted by the slowing down of domestic fixed asset investment. The company's polyether monomer and carboxylic acid superplasticizer are mainly used in concrete engineering. As our country is in the process of de-heavy industrialization, the growth rate of fixed assets investment will gradually slow down compared with before. The product demand growth rate of superplasticizer may be restricted by the slowdown of downstream application demand, the development growth rate of the industry will also decline, and the competition in the industry will become more fierce.
The company has a production capacity of 52000 tons of polyether monomer, 67000 tons of polycarboxylic acid superplasticizer and 6000 tons of solar silicon cutting liquid. The company's main customers of polyether monomers are polycarboxylic acid superplasticizer manufacturers, the company's main customers of polycarboxylic acid superplasticizer are superplasticizer compounding enterprises, concrete mixing stations or construction enterprises, and the main customers of solar silicon cutting fluid are wafer cutting enterprises.
The company's investment project is used in the water reducer project with an annual output of 100000 tons for high performance concrete and the ethylene oxide derivative project with an annual output of 30, 000 tons in Panjin, with a planned investment of 249.79 million yuan. The project with an annual output of 100000 tons of polycarboxylic acid superplasticizer for high performance concrete is expected to invest about 213.1 million yuan, with a construction period of 24 months. Construction has started in August 2013, and the net profit is expected to be about 60 million yuan. Panjin's annual production of 30, 000 tons of ethylene oxide derivatives project is expected to invest about 129 million yuan, the project has been basically completed and put into production in June 2014, and the net profit is expected to be about 27.75 million yuan after reaching production.
The company expects results to grow only slightly in 2014. Due to the obvious decline in the domestic economy, especially the significant decline in fixed asset investment represented by real estate, the company's superplasticizer products are bound to be affected by weak downstream demand. The company's net profit fell by about 20% in 2013 compared with the same period last year, and the company's net profit from January to June 2014 was only about 31.853 million yuan.
The reasonable pricing range is 14.4-15.3 yuan. It is estimated that the income of the company in 2014 and 2015 is 1.174 billion yuan and 1.35 billion yuan respectively, and the net profit attributed to the parent company is 61.05 million yuan and 74.3 million yuan respectively. Assuming that the total share capital after the issue is 68 million shares, the corresponding EPS is 0.90 yuan and 1.09 yuan respectively. At present, the average PE of the construction materials industry of CSI is 16.09 times, so consider giving the company 16-17 times PE in 2014, and the reasonable pricing range of the company is 14.4-15.3 yuan.
According to the net amount of funds raised by the company is 249.79 million yuan, the issue fee is about 30.0299 million yuan, and the new shares are calculated according to 17 million shares, which is equivalent to the issue price of 16.46 yuan per share (the above prices are calculated on the basis of the full funds raised by the company).
Risk hint: the downstream of the company is mainly in the field of fixed asset investment represented by real estate. Due to the continuous decline of the domestic economy, the demand for fixed asset investment is slowing down day by day, resulting in the risk that the company's performance is lower than expected.