Summary of the report:
The domestic leading company of sulfur recovery technology is a construction and technical service company specializing in petrochemical engineering, which mainly provides customers with one-stop solutions from pre-project planning consultation to design, procurement, construction management, start-up, settlement audit and operation services. It is committed to R & D and innovation in the technical fields of environmental protection, oil quality upgrading, device energy saving and emission reduction. By the end of 2016, there were more than 100 sets of sulfur recovery units, hydrogenation units, atmospheric and vacuum distillation units, coking units and other key units in the petrochemical industry, and more than 40 sets of oil storage and transportation systems. six plant designs have been completed, of which the total number of large-scale sulfur recovery units designed or contracted by the company is about 30. Nearly half of them are super-large sulfur recovery units with a single series of more than 100,000 tons per year, with a total sulfur treatment capacity of more than 2 million tons per year. The ZHSR domestic large-scale sulfur recovery technology independently developed by the company has a sulfur recovery rate of more than 99.98%, reaching the international advanced level. The company is one of the few companies with large-scale sulfur recovery technology and independent intellectual property rights in China.
L sufficient orders on hand, the winning rate of bidding remains high, and the performance is guaranteed that by the end of October 2016, the total amount of general contracting projects, engineering design and other business contracts in hand was 1.7736696 billion yuan, 80.1825 million yuan and 22.3278 million yuan respectively, totaling 187617.99 million yuan. The total contract amount of the main project which has not formally signed the contract but has won the bid or is in business negotiation is expected to be 1.75 billion yuan. At the same time, the company relies on the technical advantages in the engineering design of sulfur recovery, hydrogenation, atmospheric and vacuum distillation, and large-scale oil and gas storage and transportation facilities to maintain a winning rate of about 50% in the enterprise bidding, providing a sufficient guarantee for future business performance.
The deterioration of imported crude oil has promoted the demand for hydrogenation units and sulfur recovery units. China's demand for crude oil has increased steadily in recent years, but the growth rate of output is significantly lower than that of demand. China's crude oil production declined for the first time in 2016 under the influence of low oil prices. In order to meet the needs of national economic development, the import of crude oil is increasing year by year. As of May 2017, China's dependence on crude oil is close to 70%. Of the crude oil produced in the world, only 17% are sour crude, 30.8% are sour crude, and more than 50% are sour crude. In order to maximize refining benefits under high oil prices, most of China's oil refineries mainly import inferior crude oil containing sulfur or high sulfur, which requires that more hydrogenation units must be equipped with newly built refining capacity and stock capacity reformation. to match changes in the quality of crude oil. At the same time, the sulfur recovery unit must be upgraded accordingly, requiring larger scale and higher efficiency to meet the more and more stringent environmental protection requirements. Therefore, the demand for hydrogenation unit and sulfur recovery unit will further increase in the future.
L large-scale refining and chemical projects have entered the construction peak, and the engineering design industry will be the first to benefit from the construction of a number of large-scale refining and chemical projects in the next five years. According to the national development plan, China will build seven major refining and chemical industry bases during the 13th five-year Plan period; China Petroleum & Chemical invested 200 billion yuan to build four major refining and chemical bases. Petrochina Company Limited Central Committee restarted the Jieyang 20 million-ton oil refining project, the construction of the 15 million-ton Panjin refining and chemical project of the Arms Group, and the reconstruction and expansion of the production capacity of some existing enterprises. China's new oil refining capacity will be about 200 million tons in the next three to five years, accounting for 26.7% of the existing production capacity. The demand for engineering design is greatly increased by the centralized construction of large-scale refining and chemical projects. As an excellent domestic engineering company, with China Petroleum & Chemical background, complete design qualification and rich engineering construction experience, the company will significantly benefit from the investment and construction of large-scale domestic refining and chemical projects.
Profit forecast and investment suggestion
It is estimated that the net profit of the company from 2017 to 2019 is 94 million, 143 million, 194 million respectively; EPS is 0.71,1.07,1.46 yuan respectively; corresponding PE is 42 times, 28 times, 21 times. In the next three to five years, China's large-scale refining and chemical projects will usher in the peak period of construction, and the engineering design industry will usher in the spring. As an engineering company with China Petroleum & Chemical background, the company has strong competitiveness in the fields of sulfur recovery, hydrogenation, atmospheric and vacuum units, strong ability to obtain orders, and its performance has entered a period of rapid growth. The company covered it for the first time, giving it a "highly recommended" rating.
L risk hint
The uncertainty risk of the general contracting project; the risk of delaying or even canceling in the implementation of the project; the risk of customer concentration.