Main points of investment
China is the largest supplier of biotin and folic acid in the world. With the continuous transfer of the vitamin industry to China, the global demand for biotin and folic acid is almost entirely supplied by Chinese manufacturers, and only a small number of high-end products are produced by foreign manufacturers. According to statistics, in 2016, the global demand for biotin is 240t, and China produces 233t; in 2016, the global demand for folic acid is 1300 tons, and China produces 1355 tons. The amount of biotin and folic acid as feed additives accounts for about 75% of the total, and the rest is used in the fields of medicine and food.
The world's largest biotin supplier, leading in the industry in terms of technology and technology. The company is one of the earliest domestic enterprises to start the production of biotin, nisin, natamycin and other products, after years of development, has become the world's largest supplier of biotin and global biological antistaling agent nisin and natamycin, with high-quality and rich high-end customer resources at home and abroad. The company's technological level is in a leading position in the industry, and the company has core technologies such as biotin chiral lactone manufacturing method and chemical enzymatic synthesis of biotin intermediate lactone, and constantly innovates and optimizes the production process, which brings the advantages of production cost, environmental protection and cleanliness.
Valuation and investment advice: we expect the company's EPS in 2017-2019 (based on the issuance of 2000 million new shares) to be 0.77,0.84,0.93 respectively. Taking into account the comparable company's PE level, industry cycle and the company's profit growth, give the company 25-30 times PE in 2017, we think the reasonable price of the company is about 19.25-23.1yuan. According to the way of issuing new shares, the issue price is 15.09 yuan, it is recommended to apply at this price.
Risk tips: environmental protection policy risk, raw material price fluctuation risk, exchange rate fluctuation risk