Events:
Jin an Guoji issued a forecast of results for the first quarter of 2017, with a net profit of 1.4-160 million for shareholders of listed companies, an increase of 250% over the same period last year.
Comments:
1. The performance has grown faster than expected, continuing the good trend since the third quarter of last year.
Quarterly net profit 1. 4-160 million net profit, exceeding our previous expectations. The company's operating situation and product prices in the first quarter continued the good trend since the third quarter of last year, the profitability of the main business continued to enhance, and the steady improvement of operating efficiency promoted the release of operating performance.
2. The off-season is not light, which fully reflects the improvement of the company's profit flexibility after several price increases in copper clad laminate.
The first quarter is a traditional off-season in the industry, considering that the cost of glass fiber is rising every month from the fourth quarter of last year to this year, while the copper clad laminate industry generally adjusts prices in mid-late February, so the results are mainly released in March. and the first quarter will also be affected by the Spring Festival holiday and the number of working days in February, the higher-than-expected growth in the first quarter fully reflects the high prosperity of the industry and the increase in prices on the company's profit elasticity.
3. The company's quarterly report also reflects the February data of Taiwan's copper clad laminate industry.
The revenue of Taiwan's three leading copper clad laminates, Taiyao, Taiwan Optoelectronics and Lianmao, grew by 40%, 30% and 26% respectively in February compared with the same period last year, while the development of Jinju reached 63%, which once again verified the magnificent demeanor of the industry.
4. The glass fiber continues to be in shortage, and the downstream gradually enters the peak demand season, and the company's Q2 and Q3 are expected to continue to rise from the previous month.
In the early stage, we analyzed that the shortage and price of glass fiber were caused by cold repair in Changchun and other glass fiber factories. Today, the share price of Dehong, a glass fiber factory in Taiwan, rose by the limit, while Fuqiao's share price rose 5.3%, which verified the situation of glass fiber shortage. The next two or three quarters will enter the downstream PCB and lithium battery demand peak season, which is expected to support the company's high profit level of copper clad laminate. we judge that the company's Q2 and Q3 performance is expected to continue to rise month-on-month, and the second quarter net profit of more than 200 million is worth looking forward to.
4. The recent stock price correction deviates from the company's fundamentals and the corresponding underlying stock prices of Taiwan and Hong Kong stocks, and maintains a strong push.
Jin Anguoji is the domestic leader of medium-thick copper clad laminate. the release of supporting capacity of customer structure and pricing mechanism has helped it to become a flexible variety in this round of high business cycle. quarterly results once again exceed expectations, Q2 and Q3 performance is expected to continue to be month-on-month upward, high annual performance growth is expected. The recent correction of the company's stock price is relatively large, but Hong Kong stock prices such as Kingboard, Taiwan Taiwan Yew, Lianmao and Jinju Development all reached record highs last week. We believe that the company's stock price does not fully reflect the current high-profile demeanor of the industry. The company's extension strategy continues to advance, which is expected to further improve performance and valuation flexibility. It is estimated that the company's 17 / 18 net profit is 7.5 / 940 million yuan, corresponding to the annual EPS of 0.47max 1.03 yuan on 16-17-18, and the corresponding PE is times that of 42-19-15, maintaining a highly recommended rating and target price of 23 yuan.
Risk factors: the prosperity of the industry is lower than expected, the persistence of price increases is not enough, and the expansion of new business is lower than expected.
