Add code components business, optimize revenue structure
The company announced on December 1, 2015 that it intends to acquire 25% of Shanghai General Radio and Television Power components Co., Ltd. (DJV) held by GE for US $2.5 million, seeking 100% control of important subsidiaries of the components sector. in March 2016, the company adjusted the proportion of the equity acquisition from 25% to 15%, and the company will hold DJV90% shares after the acquisition. With the high gross profit margin of the components sector, the company further improves the control of DJC, the key subsidiary of the components plate, and the component business, which is conducive to improving the overall profitability and strengthening the company's ability to resist risks in the upstream industry.
The former "Konka Group" management team is in charge of Radio and Television, and it is optimistic that the company's top-down "new change" company introduces the Konka background management team. The "change of blood" of the chairman, president, chief financial officer and other brain positions shows the company's determination to seek a breakthrough in operation and management. Several senior executives have prepared rich experience in their respective management fields, and the lineup can be called luxury. We expect that the new senior management will bring new vitality to the company from top to bottom, and we are optimistic about the improvement of operating efficiency, the improvement of fees and the reversal of performance in the long term. At the same time, the operation of the company is more worthy of expectation in the short term.
Investment rating
Taking into account the accelerated transformation of the company in the future and the effective operation of the newly introduced management team, we expect the company's EPS in 2016-2018 to be-0.062, 0.008 and 0.025 yuan respectively, corresponding to 888X and 280X in 17-18, respectively, with a "buy" rating for the first time.
Risk hint
The upstream industry continues the risk of recession, market competition aggravates the risk, and the new management's operating performance falls short of the expected risk.
