There are plenty of orders on hand, and the rapid growth of future performance is guaranteed. The company benefited from the supply-side reform and Belt and Road Initiative, and the traditional heavy machinery business came out of the ice valley in 2017. At the same time, after a large amount of capital investment and cultivation, the emerging business high-speed rail axles, offshore drilling platforms, offshore nuclear power platform core components are expected to begin to gradually contribute to performance. At present, the company is expected to double the growth rate of on-hand orders, and there is no worry about high performance growth, but the confirmation cycle from heavy machinery orders to revenue and profit is relatively long, which is expected to be more clearly reflected in the profit statement from the beginning of the second quarter.
The top-level plan for the reform of state-owned enterprises in Shanxi Province is coming soon, and the reform of state-owned enterprises is worth looking forward to. The top-level design plan for the reform of Shanxi state-owned enterprises is expected to come out in April this year, when the supporting national reform plans of relevant listed companies can be launched one after another. Taiyuan heavy Industry as the only high-quality listed company of heavy equipment in Shanxi Province, the parent company Taizhong Group has high-quality assets such as high-speed rail wheelsets and high-end heavy machinery, which has a strong synergy with the company's business.
At the same time, the company belongs to the type of enterprises that the state encourages debt-to-equity swap, there is a possibility of debt-to-equity swap, and the company is expected to have a strong national reform.
Investment logic remains the same, maintain strong recommendation! Based on the existing business, the net profit in 2016-18 is expected to be-18.5,2.1,410 million yuan respectively, and the EPS is-0.72,0.08,0.16 yuan respectively. The cyclical bottom reversal performance is very flexible. Compared with similar companies, the company has a better business structure and a high position in the industrial system. Combined with the comparable company PS and the overall market capitalization comparison method, the current market capitalization of the company is significantly undervalued, with a target market value of 17 billion yuan and a target price of 6.6 yuan.
Risk hint: supply-side reform slows down; emerging business expansion is low-expected.