I. Overview of events
Recently, we have communicated with the management of the company on the company's development prospects and strategic planning.
II. Analysis and judgment
Based on the aviation market, rich product line
The company is based on aviation, the main products and services are related to aviation inertial navigation and aero-engine electronics. Among them, aviation inertial navigation products are integrated navigation products which mainly take inertial navigation technology as the core and integrate multi-system information such as satellite navigation system and Doppler navigation system. The aero-engine electronic business further develops the aero-engine electronic control system based on the aero-engine parameter collector to control the engine as much as possible without operation restrictions on the premise of ensuring the safety of the engine.
Inertial navigation business is developing steadily and is expected to expand in the future.
The company's inertial navigation products include laser inertial navigation, flexible inertial navigation, optical fiber inertial navigation and so on. The main application fields downstream are helicopters. Inertial navigation business is the company's largest source of income, accounting for about 70%, and the gross profit margin remains high, about 45%. At present, inertial navigation products have been widely used in the military field, especially in the aerospace field. In addition, with the gradual decline of the cost, the utilization rate of inertial navigation in civil aviation is getting higher and higher. Benefiting from the gradual release of downstream market demand, the company's performance is expected to increase.
The market space of aero-engine is vast, and the company shares the growth dividend of the industry.
The company's aero-engine products mainly include aero-engine parameter collector and aero-engine electronic control system. This business segment is the company's second largest source of income, accounting for more than 20%, with a gross profit margin of more than 50%. According to the data of the company's prospectus, it is estimated that by 2020, the market scale of China's aero-engine industry will break through the 100 billion mark. At the same time, with the rapid development of engine testing technology and control technology, the proportion of engine electronic technology is increasing. Benefiting from the great development of the industry, the company's performance is expected to explode.
Third, profit forecast and investment suggestions
The company has been engaged in the field of aviation information for many years, and we are optimistic about the long-term development of the company. From 2017 to 2019, the company's EPS is expected to be 0.63,0.74 and 0.92 yuan respectively, corresponding to PE of 62X, 53X and 43X, covering for the first time and given a "cautious recommendation" rating.
IV. Risk hints
1. The number of helicopters released downstream fell short of expectations; 2. The development of new products fell short of the expected rapid growth of the industry, with an income of 46.61 million yuan, an increase of about 19 times over the same period last year. Optoelectronic components and their new products increased the market revenue by 87.62 million yuan, an increase of 68.82% over the same period last year.
