Main points of investment

Increase efficiency and reduce consumption to achieve endogenous growth

According to KuaiBao, the company expects to achieve operating income of 11.78 billion yuan in 2013, an increase of 7.4 percent over the same period last year, and a net profit of 112 million yuan, an increase of 29.9 percent over the same period last year. The increase in net profit is greater than that in revenue, which is mainly due to the endogenous growth achieved by increasing efficiency and reducing consumption: 1, give full play to the advantages of scale, improve production efficiency and reduce losses, gross profit margin has increased; 2, a sharp decline in bank loans and interest expenses; 3, a reduction in bad debt losses.

The demand of the downstream real estate industry is still low.

The demand for construction profiles in the downstream real estate industry is still low, mainly as follows:

1. The price of electrolytic aluminum for raw materials is still in a downward channel. Shanghai Aluminum is currently quoted at 13120 yuan / ton, down 6.4% from the beginning of the year.

2. The performance of the national housing index is mediocre, with the latest value of 96.91 in February.

In March and February, the total area of new housing construction was-27.4% compared with the same period last year, and the area completed was-8.2% compared with the same period last year.

Profit forecast and investment rating: maintain "buy"

We predict that the company will achieve net profit of 111 million yuan, 155 million yuan and 198 million yuan from 2013 to 2015, equivalent to 0.47 yuan, 0.65 yuan and 0.83 yuan per share respectively, an increase of 29%, 39% and 28% respectively over the same period last year, and the corresponding dynamic PE is 17 times, 12 times and 10 times respectively. In order to maintain growth and expand domestic demand, the market's loose policy on the real estate industry is expected to be strengthened, and the company, as a leading enterprise in building profiles, will benefit from the loose policy of the downstream real estate industry. At the same time, the company will also benefit from the promotion of green building materials to the countryside, the promotion of national urbanization and the rapid development of government resettlement housing indemnificatory apartment construction. We maintain the company's "buy" investment rating.