What happened: the company recently released its 2017 annual report, with an operating income of 1.66 billion yuan, an increase of 9.26% over the same period last year, and a net profit of 12 million yuan, down 33.40% and 0.54%, respectively.
The rail transit plate business is about to take off, the early technology reserve advantage is gradually reflected, and the performance release is just around the corner. In 2017, the company actively developed rail transit business, making use of the advantage of pre-technology reserve, successively won Chengdu "IT Avenue" and other subway and modern rail projects, and landed a suspended rail project in Panzhihua, which was the first hanging project for the company. In the future, the company will continue to rely on the advantages of Sichuan Province and continue to expand its rail transit business to Yunnan and Guizhou provinces. The next three years will be an important window for the sustained high growth of the company's rail transit business. In addition, the company introduced German high-end medium-and low-speed magnetic levitation system, after 6 years.
The track system continues to develop, and there is a broad space for the future. At the beginning of 2012, the company started research and development, and so far the company has mastered a full range of technologies including design, manufacturing, construction and maintenance, and applied for nearly 50 national patents; successively passed the technical evaluation and technical appraisal of Sichuan Provincial Science and Technology Department and Sichuan Economic and Information Commission; and took the lead in obtaining the URCC certification of urban rail transit at the beginning of 2016, which provides technical qualification and strong guarantee for the integrated manufacturing and industrialization of embedded continuous support ballastless track system. The system has the advantages of restraining rail wave grinding, long service life, low operation and maintenance cost, remarkable vibration and noise reduction performance, rapid on-site construction and so on. At present, it has been well used in Xinjin R1 line, Yunnan Honghe tram project, Guangzhou subway and other projects, and has been recognized by the owners.
Layout of supercapacitors to lock in the future development trend. The company's supercapacitor system business is undertaken by the holding subsidiary Aowei Technology. As the leader of domestic supercapacitor subdivision industry, Aowei Technology not only covers almost all types of supercapacitors in the world, but also undertakes the research and development of supercapacitor technology in the country and industry. The products are mainly used in overseas buses, tunnel locomotives and trams. During the reporting period, Aowei Technology supercapacitor products obtained the first domestic ECE R100 certificate and ECE R10 certificate, which belongs to the scarce resources in the same industry in the world.
Profit forecast and rating. According to the company's business development progress and planning, we estimate that the company's operating income from 2018 to 2020 will be 2.728 billion yuan, 3.851 billion yuan and 5.04 billion yuan respectively, and its net profit will be 139 million yuan, 192 million yuan and 252 million yuan respectively, and the corresponding PE will be 35x, 25x and 19x respectively.
Risk tips: macroeconomic downturn; rail transit business promotion is not up to expectations; systemic risk and so on.