This report is read as follows:
The independent R & D and production capacity of high-performance separation membrane is still the main growth line of the company. at present, the promotion of sea-light membrane and the maturity of battery separator will be the new growth point of the company.
Main points of investment:
Profit forecast and investment rating: in view of the slower-than-expected epitaxial expansion of the company and increased competition in the home film market, the company's 18-19-year net profit is forecast to be 146 million yuan (down 41%) and 181 million yuan (down 50%), corresponding to 0.35 and 0.43 yuan per share (EPS). As the only domestic company that can independently produce high-end RO film, the company has obvious unicorn characteristics, maintaining the previous 30 times PE forecast, corresponding to the 18-year profit forecast, the target price is 10.5 yuan (down 46%), and the overweight rating is maintained.
Net profit in 2017 increased 16% compared with the same period last year. In 2017, the company realized operating income of 1.083 billion yuan, an increase of 7% over the same period last year. The net profit attributable to the parent company was 125 million yuan, an increase of 16% over the same period last year. Net profit attributable to excluding non-recurrent profit and loss was 101 million yuan, an increase of 26% over the same period last year. The comprehensive gross profit margin was 41.47%, which was down 2.47pct from the same period last year. The lower-than-expected performance was mainly due to the slower-than-expected epitaxial expansion and the decline in product prices after intensified competition in the household film market.
Wharton and Nature Technology maintained steady growth in the two key sectors: (1) the net profit of Wharton was 147 million yuan, an increase of 17.24% over the same period last year, but competition in the civilian market intensified, resulting in a decline in gross profit margin. (2) the net profit of Nature Science and Technology was 37 million yuan, an increase of 9.63% over the same period last year, and both income and gross profit margin increased steadily. Expenses are flat year-on-year, and the return of funds is smooth.
The expansion of sea-light membrane and battery membrane is the focus of the future: the independent research and development and production capacity of high-performance separation membrane are still the main growth line of the company. at present, the battery separator independently developed by the company is in the pilot stage and is expected to become a new profit point for the company in the future. The overseas application of sea light film is in the stage of market promotion. At the same time, the company is actively trying a new growth point in the layout of epitaxial mergers and acquisitions, negotiating nearly 140 projects in 2017.
Risk hint: the progress of battery diaphragm industrialization and the overseas application of RO membrane are slower than expected.
