Main points of investment:
The increase in the sales scale of the defense business has led to a substantial increase in the performance of the company. Optoelectronic shares achieved operating income of 877 million yuan in the first half of 2018, an increase of 78.19% over the same period last year; the net profit of its parent was 24.86 million yuan, an increase of 233.46% over the same period last year; the substantial increase in the company's performance was mainly due to changes in the structure and sales of defense products, the increase in sales of products with higher gross profit margin compared with the same period last year, and the decline in the cost of civilian products. During the reporting period, the comprehensive gross profit margin of optoelectronic shares was 11.08%, and the net profit rate was 2.82%. In terms of business, the defense business realized sales revenue of 579 million yuan, an increase of 332 million yuan over the same period in 2017, an increase in price difference income from final assembly products, and optical materials and devices business realized sales revenue of 346 million yuan, an increase of 83 million yuan over the same period in 2017.
The defense business has a solid market position, and new projects and products continue to increase. The optoelectronic defense service consists of three parts: large-scale weapon system assembly integration, precision seeker and optoelectronic information equipment. During the reporting period, the general assembly of large-scale weapon systems developed towards collectivization and serialization, and newly won the development tasks of many projects; the business order task of precision guidance seeker is full, realize the technological innovation and model expansion of laser-guided missiles, guided bombs and rockets used for different diameter terminal guided projectiles and different launch platforms, and consolidate the position of the company's domestic scientific research and production base of seeker. In the field of optoelectronic information equipment, the company lays the foundation for the company's foreign trade orders through long-term friendly cooperation with the overall unit.
The business of optoelectronic materials and devices is rising steadily. The subsidiary New Huaguang has strong technical and market advantages in the field of domestic optical materials. During the reporting period, Xinhua Light Company actively sought terminal cooperation to expand the high-end market of military and civilian products, and its production and sales were in the forefront of the country. In the aspect of infrared chalcogenide glass plate, the company has reached the international leading level of technology, participated in the compilation of many standards in this field, made progress in the research of precision molding technology, and cooperated with downstream processing, lens and other terminal enterprises to realize the upstream and downstream industrial alliance.
Profit forecast and valuation. We estimate that the EPS of Optoelectronic shares from 2018 to 2020 will be divided into 0.15 yuan per share, 0.15 yuan per share and 0.17 yuan per share. Optoelectronic shares closed at 12.20 yuan on August 24, 2018, corresponding to the 2018 PE valuation as high as 81 times, higher than the average valuation of comparable companies, we do not give the company a reasonable value range and investment rating.
Risk hint. Military orders fluctuate; military competition intensifies, leading to a decline in gross profit margin; and market demand for optical materials is lower than expected.
