Main points of investment:
The company made a net profit of 94.39 million yuan in the third quarter, an increase of 163.1% over the same period last year. The company announced that its operating income in the third quarter was 2.89 billion yuan, an increase of 96.49% over the same period last year. The net profit attributable to the company was 94.29 million yuan, an increase of 163.1% over the same period last year. The operating income in the first three quarters was 8.94 billion yuan, an increase of 162.39% over the same period last year, and the net profit attributable was 330 million yuan, an increase of 134.08% over the same period last year. The substantial increase in performance in the third quarter is mainly due to the increase in the volume and price of the company's products. The company expects the full-year net profit range to be 418-506 million yuan, an increase of 140% 190% over the same period last year.
The prosperity of the pesticide market has rebounded, and the implementation of the new policy is conducive to industry integration. Since the second half of 2016, international crude oil prices have stabilized and rebounded, coupled with the restocking cycle of international agrochemical giants leading to a pick-up in overseas demand and a rebound in the pesticide market. Superimposed by factors such as the strictness of domestic environmental protection inspectors and the suspension of production restrictions by enterprises, the overall upward trend of pesticides is obvious. According to data from the China Pesticide Industry Association, the pesticide price index (CAPI) in July was 81.98, down 1.05% from the previous month and up 20.62% from the same period last year. According to Zhuochuang data, the price of prochloraz, the company's dominant product, has been maintained at about 5.5-60,000 yuan / ton since 2016. at present, the latest price has risen to 65,000 yuan / ton, and permethrin has risen to 210,000 yuan / ton from 150,000 yuan / ton at the beginning of the year. Permethrin rose from 190,000 yuan / ton at the beginning of the year to 250,000 yuan / ton.
New capacity is released and performance is expected to double. In April 2016, the company raised and invested 5000 tons of glyphosate, 1000 tons of anti-inverted ester and 2000 tons of methoxyfenozide gradually landed, becoming a new profit growth point. Among them, the anti-inverted ester project was put into production at the end of 2016; the glyphosate project entered the commissioning stage in the second quarter of this year, with the largest production capacity of a single unit in China, with scale and cost advantages. The company expects that the commissioning of all three projects will bring about 440 million profit contribution, and the full production performance is expected to double in the future.
The warehousing business broke out and the revenue contributed significantly. The company is based on Dafeng Port to build 308,000 Fang Petrochemical warehousing project. At present, 148,000 Fang has entered the normal operation stage and made a significant contribution to revenue. The proportion of 17H1 warehousing business was 59.73%, compared with 20.84% in the same period last year, which increased greatly. In the future, the company will actively give full play to the advantages of marketing network, through electronic deployment of terminal products to improve logistics efficiency and profitability.
Profit forecast and valuation. We believe that the company has the flexibility of quantity and price at the same time, and continues to benefit from the transfer of the pesticide industry to China and the rise in product prices brought about by high environmental protection. We expect the company's net profit for 17-19 years to be 4.21,5.29,652 million yuan, corresponding to EPS 0.28,0.35,0.43 yuan respectively. Considering the rapid growth of the company, the company is given a purchase rating of 25 times higher than the industry average in 17 years, with a target price of 7.0yuan.
Risk hint: the price of agricultural products fell; the launch of new products was lower than expected.
