Main points of investment
The company is mainly engaged in oil drilling and production wellhead equipment. The company is mainly engaged in oil drilling and production wellhead equipment research and development, production and sales, the main products are lifting equipment, clamping equipment and screw equipment, is one of the earliest enterprises engaged in oil drilling and production wellhead equipment production and sales. The company's products are used in almost all the major onshore and offshore oil and gas fields in China, and have been tried out in the Middle East, Africa, North America, Central and South America, Russia and other major oil-producing regions in the world.
The growth of downstream oil and gas exploration and development is expected to increase the demand for drilling and production wellhead equipment. The demand for oil and gas resources in China continues to grow, and the steady increase in oil and gas production has increased the demand for oil drilling and production equipment, and the scale of natural gas exploration and offshore oil and gas field exploration and development has expanded rapidly. In addition, overseas petroleum engineering operations will be an important market for drilling and production equipment in the future, and generally speaking, China's major oil and gas development enterprises regard overseas operations as the focus of future development, and the planned target of overseas operations is expected to reach about 300 million tons. the increase in the overseas operation volume of oil and gas development enterprises can expand the overseas operation market scale of domestic petroleum engineering and technical service enterprises. This leads to a steady increase in the business scale of China's oil drilling and production equipment international market. The increase in the export of China's large-scale drilling and production equipment manufacturers is expected to further promote the development of the whole industry chain.
The company has pre-developed into a leading enterprise in the industry to create a "Rutong" brand. Under the guidance of the development strategy of "science and technology driving, project leading, talent strengthening and cultural cohesion", the company will strive to build the company into an industry leading enterprise with independent innovation ability, perfect product line and international competitiveness in the field of oil drilling and production wellhead equipment, and create a "Rutong" brand with "domestic navigation and international leadership".
Valuation and rating: based on the issued equity, we predict that the EPS of the company from 2016 to 2018 will be 0.36,0.42,0.51 yuan, respectively, an increase of 14.97%, 16.86% and 22.67% respectively over the same period last year. With reference to the valuation of the comparable company, and taking into account the future demand of the company's products and the competitiveness of the company, we think that it is more reasonable to give the company 30 times PE in 2016, and the reasonable share price is 10.80 yuan to 14.40 yuan. Coverage for the first time, no rating for the time being.
Risk hint: the risk of continuous decline in capital investment of oil and gas development enterprises and fluctuations in the prices of major raw materials.