Core ideas:

1. Event

In 2015, the company achieved an operating income of 1.1632662 billion yuan, an increase of 73.51%, and a net profit of 338.6488 million yuan, an increase of 209.18%. Deducting 298901535 yuan from the non-return mother, an increase of 180% over the same period last year. The company plans not to pay cash dividends, no bonus shares, no provident fund to increase share capital.

two。 Our analysis and judgment

(1) the construction of overseas industrial parks has led to a substantial increase in the export of complete sets of equipment

The sharp increase in revenue and profit is mainly due to a sharp increase in orders for the company's machinery and equipment business compared with the same period last year. The income of complete sets of machinery and equipment was 1088071684 yuan, accounting for 93%, an increase of 284% over the same period last year, and a gross profit margin of 48%. From a regional point of view, the company's overseas income is 1102123616 yuan, accounting for 95%.

Sales expenses of 28.49 million yuan increased by 191.27% over the same period last year; management expenses were 106.4 million yuan, 173% over the same period last year, of which equity incentive fees were 26.48 million yuan, an increase of 18.74 million yuan, and R & D investment was 43.57 million yuan, an increase of 3204 yuan.

(2) the business model of overseas industrial parks is becoming more and more mature

Since the planning and construction of the industrial park in Indonesia, a complete development model for investment, development, investment and operation of the industrial park has been explored. That is, take electric power construction as the core, take the merger and acquisition of local mineral resources as the starting point, invest locally to establish an industrial park, engage in the infrastructure construction of the industrial park, build an industrial park platform with five links and one flat, and attract relevant enterprises to enter the park. and provide industry and commerce, taxation, logistics, life and other logistics support; deep processing of mineral resources, improve the added value of products, forming a mutually beneficial and win-win industrial ecology of the upper and lower reaches of the industrial park. The first phase of the blast furnace project of Sulawesi Nickel-Iron smelting Industrial Park in Indonesia, which is currently under construction, has been ignited and put into operation on December 28, 2015, and will be officially put into production in 2016.

On the basis of the construction of overseas industrial parks, the company will build industrial cities at the right time, and develop and operate tap water, natural gas, roads, ports, wharves and fisheries in parks and local cities.

The company will set up industrial investment funds and private equity venture capital funds in due course, focusing on investment in environmental protection industry, cleaner production, health care, efficient utilization of special minerals and development of new materials.

(3) complement each other's advantages and go to sea together

Qingdao City Investment has bought the company's shares from the secondary market and has become the second largest shareholder of the company with a stake of 14.18%. Qingdao City Investment, as a large state-owned enterprise in Qingdao, forms a complementary effect with Heng Shunzhong in financing and urban development and construction. In addition, we signed cooperation agreements with China Development Bank, the second Hospital of China Railway and the Qingdao government to go out to sea in groups. The demonstration effect of Indonesian industry makes the company's overseas business development more smoothly.

(4) continuous optimization of internal governance institutions

The organizational structure has been further adjusted to optimize the functions of various departments of the company, so that the company's management model can better promote the development of the company's business model. The company has changed from the traditional whole-process manufacturing organization mode to the platform light-asset modern manufacturing mode. For the resource countries, the company is the investor and investment platform, for the domestic manufacturers, the company is the system optimization and integrator. Its production organization has been changed to the production organization form of "decision center + operation command center + business execution center". The decision center is composed of top-level professional institutions in the industry, which are on the basis of research. Provide professional decision-making advice for the company. Operation command center: composed of the company's board of directors, the general referee and various business departments, make good decisions on the work by using the opinions of relevant experts in the decision-making center. Business execution center: the company's personnel supervision and control, external collaborative processing-based model, in accordance with the "business command center" deployment, production and processing. The processing and production of a large number of non-core products are mainly entrusted to professional enterprises in the industry. Through the transformation of the mode of production organization, the quality of products is improved, a lot of manpower costs are saved, and the talent structure of the company is continuously optimized.

In the 2015 employee stock ownership plan, core executives and employees will greatly increase their holdings of the company's shares to promote the harmonization of the interests of the company's employees.

3. Investment suggestion

The company's net profit from 2016 to 2017 is expected to be 5.23 yuan and 947 million yuan respectively, an increase of 54% and 81% respectively. Considering the company's business expansion in South Africa, Zimbabwe, Thailand and Laos, the company's performance is expected to maintain rapid growth after 2017. The company acquires a large amount of mineral resources at low prices, and has huge room to increase its reserves, including Indonesian nickel mine, coal mine, manganese mine and South African coal mine. According to the company's business model, the continuous injection of high-quality overseas resources into listed companies will become the norm and maintain the company's recommended rating.

4. Risk hint

The company's shares have the risk of being suspended, the risk of exchange rate changes, and the risk of political environment for overseas investment.