Item:
Snow Wright issued a non-public offering plan, which will buy 100% stake in Zhuoyu Automation by issuing shares and paying cash, with a transaction consideration of 300 million yuan.
Main viewpoints
1. The company acquires the target company through cash plus stock issuance, not publicly raising matching funds.
According to the company's non-public offering plan, 35% of the 300 million yuan transaction consideration of Zhuoyu Automation was paid in cash, totaling 105 million yuan, while the remaining 65% was paid in the form of shares, with an issue price of 6.1 yuan, with a total of 31.967 million shares. At the same time, the company will also raise no more than 78 million yuan from the non-public offering of supporting financing subscribers to pay the cash consideration and intermediary fees of this transaction.
two。 Zhuoyu Automation is the leader in the subdivision field of lithium power equipment, and Snow Wright has sufficient funds and financing ability to provide a strong driving force for development.
Zhuoyu Automation's main products are power lithium battery production equipment, providing downstream lithium battery manufacturers with automatic production equipment for middle and rear lithium battery, including helium leak detection machine, cell hot press, core welding machine, etc. Downstream customers include CATL, AVIC Lithium Power, Hubei Jinxinquan (Yiwei Lithium Energy subsidiary) and other well-known power lithium battery manufacturers.
Zhuoyu Automation is the leader in the field of lithium battery helium leak detection equipment and cell hot pressing equipment. Due to its short establishment time and mainly relying on its own funds for internal development, its capital strength is relatively weak, which limits the development of the company's business scale. Snow Wright has more than 500 million working capital on its books, which will inject strong impetus into the business development of Zhuoyu Automation and provide long-term financing demand guarantee with its own strong financing ability.
3. The power lithium battery has entered the peak period of production expansion, and Zhuoyu has a broad development prospect.
Under the background of the rapid growth of production and sales of new energy vehicles and the release and implementation of the double points system for automobile enterprises, the market demand for power lithium batteries is rising rapidly, and lithium battery manufacturers have also entered the cycle of investment and expansion in 2014-2016. the combined capital expenditure of the four major A-share lithium battery companies increased by 5.6 times. The peak of production expansion has brought a strong demand for lithium power equipment. It is estimated that the market size of the equipment is nearly 50 billion in 17 and 18 years, of which the equipment in the middle and later stages accounts for 90%. Zhuoyu will significantly benefit from such an industry environment. Zhuoyu has achieved operating income of 55.36 million yuan and net profit of 14.72 million yuan in the first half of 2017. Revenue and net profit in 2017 are expected to achieve a rapid growth of 120% and 500% compared with the same period last year.
According to the performance commitment of Zhuoyu Automation, the net profit of 22 million yuan, 33 million yuan and 49.5 million yuan will be deducted from 2017 to 2019.
4. The company's integrated development strategy has achieved initial results, and multi-business areas will work together to help the company to take off while continuously tamping the main business of "optical technology application". Continue to promote the development of "smart consumer electronics" business, and continue to actively layout "high-end intelligent manufacturing", "automotive core components" related emerging industries. Today, Manta Intelligence, a holding subsidiary of intelligent consumer electronics companies, has put a number of small consumer UAV products such as S6 on the market; Yujie Intelligent packaging equipment and Fushun Optoelectronics charging pile products, a subsidiary of high-end intelligent manufacturing, are constantly opening up new markets, and their revenue is growing steadily. In the future, the company will have diversified competitiveness and profitability.
5. Profit forecast
It is expected that Zhuoyu Automation will consolidate the table next year. After consideration and statement, it is estimated that the company will achieve operating income of 980 million yuan, 1.455 billion yuan and 1.908 billion yuan from 2017 to 2019, and realize net profit of 32 million yuan, 98 million yuan and 144 million yuan, corresponding to EPS of 0.04,0.13,0.20 and PE of 179x, 58x and 39x. Give a recommended rating.
6. Risk Tips:
After a while risk, downstream demand is not as expected.