Event

The company issues a statement on the commitment of senior executives to reduce their holdings.

Mr. Chen Yu does not directly hold the shares of the company, but holds 78789 shares, or 0.05%, of the company through the Shanghai Linglong Whale Investment Management Partnership (limited partnership). After leaving office, he will abide by the relevant laws and regulations such as the "detailed rules for the implementation of share reduction of shareholders, Directors, Supervisors and Senior managers of listed companies on the Shenzhen Stock Exchange" and other relevant laws and regulations on the reduction of shares held by outgoing supervisors of listed companies. Within six months after leaving office, it will not transfer its shares in the company and abide by other relevant restrictions. His spouse, children and other immediate family members do not directly or indirectly hold the shares of the company.

Brief comment

Improve the company's core competitiveness with the help of "made in China 2025"

Numerical control system is one of the bottlenecks restricting the development of CNC machine tool industry in our country. The weak foundation and "lack of core and little brain" has always been the deficiency of "made in China". Compared with the machine tool powers in the world, there is still a certain gap in China's machine tool industry, especially in the low competitiveness of medium-and high-grade machine tools. Therefore, "made in China 2025" lists CNC machine tools and basic manufacturing equipment industry as one of the strategic areas of China's manufacturing industry.

With the opportunity of "made in China 2025" and other major policies, key areas such as intelligent manufacturing will usher in new development. The company takes advantage of this opportunity to strengthen high-end intelligent remanufacturing key technology innovation and industrial application; promote intelligent remanufacturing equipment research and development and industrial application; implement high-end intelligent remanufacturing demonstration project; cultivate high-end intelligent remanufacturing industry coordination system and so on. Promoting high-end intelligent remanufacturing will help to promote continuous breakthroughs in green manufacturing technology. According to the market demand, the company focuses on the R & D technology of medium-and high-grade machine tools to improve the core competitiveness of the company and find new profit growth points for the company.

Has the key technology research and development ability, is in the industry leading position

The company has achieved independent research and development and production on several key components of the motion control system, follow-up control unit and servo drive, and has a strong competitiveness in the scheme performance evaluation. The company is one of the few companies in China to master motion controller CNC system and servo drive technology at the same time. The company's water cutting control system covers a full range of motion control solutions from two axes to five axes, among which the five-axis water cutting system can realize dynamic five-axis cutting to solve the taper, tailing and other technological problems of high-pressure water jet. It is the earliest and most mature water cutting control system in China, which is mainly used in cutting metal, stone, glass, ceramics and other industries.

Increase R & D investment and improve the company's core competitiveness

The company continues to invest heavily in technology research and development, and strives to enhance its core competitiveness. During the reporting period, the company always pays close attention to the development trend of the industry, actively does a good job in the research and development of new products and technology reserve, and constantly increases investment in research and development. The total R & D expenditure was 51.2181 million yuan, accounting for 25.79% of business income, an increase of 51.59% over the same period last year, providing a strong guarantee for the company to further improve its core competitiveness. At the end of the reporting period, there were 279 R & D personnel, accounting for 53.45% of the total number of the company, an increase of 26.24% over 2016.

High-precision system is the research and development goal, as the company's new profit increase point, the company will take the high-speed and high-precision system as the research and development goal, produce large-scale composite machine tool control system, as the company's new profit increase point. Continue to develop projects with core competition: Mechatrolink-II bus servo driver, Phoenix motion control platform project, perfect inspection technology, RTCP function research project, industrial bus, Thunder platform project. Among them, the company has launched a number of servo drivers, which can drive servo motors with various power, and the market response is good; five-axis RTCP control algorithm is becoming more and more mature and has been used in batch water cutting products.

Focus on the field of motion control and develop steadily in both vertical and horizontal dimensions.

Focus on the field of motion control, from the vertical and horizontal dimensions of development. Vertically, mainly CNC systems and servo drives, continue to expand categories, expand application scenarios, and enter more industries, from CNC machine tools to other types of CNC equipment, which is the core business of the company's future development; horizontally focus on Weihongyun, layout the development of intelligent manufacturing, smart factories, comply with the general trend of the Internet of things in the future. The company will be R & D, market-oriented, make full use of the technological R & D capability, market influence, product popularity and other advantages accumulated in the industry for many years, in order to improve the overall economies of scale, improve product quality and technological innovation as the driving force.

It is estimated that the company's EPS in 2018 and 2019 will be 1.70,1.90 yuan, corresponding to 37,33 times of PE, maintaining a "buy" rating with a target price of 70.00 yuan.

Risk Tips:

1. The risk of intensified market competition

2. the risk of a decline in gross profit margin

3. The operation and management risks caused by the expansion of the company.