Main points of investment
Product structure optimization + production cost reduction, the company's profitability significantly improved: the company is mainly engaged in POF heat-shrinkable film product research and development, production and sales, has become the domestic share of the first, the world's second POF heat-shrinkable film industry leading enterprises. The company adheres to the market competition strategy of high-end and differentiation, actively optimizes the product structure and enhances the proportion of high value-added products such as cross-linking films. In the past 17 years, the company's product structure is expected to be further optimized, and the steady growth of the main industry will provide the company with a stable cash flow of 100 million per year.
With the imminent release of production capacity, TPAE will become a new profit point: in December 15, the company announced that it planned to raise no more than 400 million yuan in a non-public offering to invest in the construction of a thermoplastic elastomer production project with an annual production capacity of 120000 tons, which has been approved by the CSRC. As a new trend in the development of thermoplastic elastomer materials, the new TPAE material has a large market space and is a unique product of the company. the technical and technological barriers are extremely high, and the price of similar products in the international market is as high as 120,000 yuan / ton. The company can broaden the hardness range of TPAE materials by filling oil and reduce the production cost. On the one hand, it can realize the substitution of imported products, on the other hand, it can expand new application fields after reducing the cost. It is expected to be put into production at the end of the second quarter of 17 years. After reaching production, it is conservatively expected to achieve an average annual sales income of 2.96 billion yuan and an average annual profit of 1 billion yuan (51% of the company's shareholding), which will not only enrich the company's product line. at the same time, the company will usher in an important performance inflection point, profitability will enter a rapidly rising channel.
Obtain patents related to propylene polymers, which can be used in the production of marketable securities: in May 15, the company plans to invest no more than 100 million yuan to build a "high-performance functional polypropylene film trial production project". Used to build a trial production line of high-performance functional polypropylene film and deepen its scale-up. Over the past 16 years, the company has received a number of invention patents on propylene polymers issued by the State intellectual property Office. These patents can be used to make securities. The acquisition of patents promotes the company's sustainable development ability, enriches the company's product line, and is expected to bring new breakthroughs for the company's long-term development.
Profit forecast and valuation: the company actively layout and carry out the research and development of new materials and new processes, constantly improve the product structure and expand new business areas. With the gradual release of fund-raising capacity and the transformation of new R & D achievements into real productivity, we are optimistic about the long-term development of the company. We estimate that the company's operating income in the past 18 years will reach 539 million yuan, 701 million yuan and 1.506 billion yuan respectively, and the net profit attributed to the parent company will be 1.05 yuan, 100 million yuan, 136 million yuan and 450 million yuan respectively, with year-on-year growth rates of 54.84%, 29.14% and 232.41% respectively. Taking into account the additional issuance and dilution, the EPS in 17-18 years is 0.15 yuan and 0.5 yuan respectively, and the current stock price corresponds to 36 times PE in 18 years. Give a buy rating with a target price of 28 yuan.
Risk tips: raw material prices fluctuate sharply, the construction progress of fund-raising projects is not as expected, the sharp decline in macroeconomic growth affects downstream demand, and the intensification of industry competition affects product prices and profitability.