Main points of investment:
The State Council decided to adjust the total investment in railway fixed assets to 800 billion yuan in 2014, an increase of 100 billion over the plan at the beginning of the year. Among them, the national railway investment has been adjusted from 630 billion yuan to 730 billion yuan, and the railway equipment industry will benefit from the increase in the scale of investment.
Jinxi axles based on train vehicles, axle products, positioning high-end, adhere to diversified development, committed to become a railway truck and its core parts supplier, has a strong competitive strength.
The trend of localization of high-speed EMU series bearings is relatively clear, and it is expected to fully open the prelude to localization in 2015. Due to the high gross profit of EMU series axles, which is expected to be about 40%, according to the current railway high-speed development trend, the company's profitability will be greatly improved.
Relying on China Arms Industry Group and Jinxi Industrial Group, Jinxi axles have unique advantages in technological upgrading and industrial upgrading, and the company is expected to get more policy and technical support in the future. The company participated in the BOT project of Taiyuan municipal solid waste incineration power plant signed by Jinxi Group. Due to the gradual attention to the environmental protection industry, the grate-type waste incineration equipment market space is broad, and the future profit of the company's environmental protection industry plate is worth looking forward to.
Valuation:
We believe that the company's EPS from 2013 to 2015 is 0.35,0.39 and 0.41 yuan respectively, which is based on the closing price on June 12, 2014, corresponding to PE of 36.49x, 31.96x and 30.9x, maintaining the company's "buy" rating.
Risk hint
1. The economic recovery is slow and the direction of government's macro-control is uncertain.
2. the slowdown of fixed asset investment in the railway industry and the risk of delay in train bidding by the Railway Corporation.
3. If the capacity expansion of the company's fund-raising projects slows down, the release of the company's performance may be delayed.
4. The new product needs to be further tested in practical application, and there are certain practical risks.