Event: the company's results in the first half of 18 years increased by 56.0% compared with the same period last year.
The company released the mid-18 year report that the operating income in the first half of 18 years was 1.842 billion yuan, an increase of 131.1% over the same period last year, which was related to the consolidation of CCI (only in May and June in the first half of 17 years), and also related to the gradual increase in the volume of new electro-hydraulic pumps and gearbox pumps. The net profit was 99 million yuan, an increase of 56.0% over the same period last year, and 97 million yuan after deduction, an increase of 66.4%. After realizing full dilution, EPS is 0.94 yuan. In the first half of 18, the company's gross profit margin was 29.7%, and the net interest rate was 5.5%. During the period, the expense rate rose 0.8% from the same period last year to 21.9%, mainly due to the 0.9% increase in the financial expense rate in the first half of this year due to the increase in interest expenses after the debt financing acquisition of CCI.
The company actively transformed and upgraded in response to changes in market demand, and gradually increased the number of fund-raising projects in line with expectations in the face of industry changes. The company actively transformed and upgraded to cope with the changes in market demand, and developed automatic gearbox pumps, EHPS electro-hydraulic pumps, EPS motors, PEPS and so on. According to the China News, the company's traditional HPS pump products remain stable, the new automatic gearbox oil pump has been supplied in batches such as Auto change, Hunan Jisheng, etc., the gearbox electric pump has been supplied in bulk to car, Shandong Shengrui, etc., EPS Motor has also obtained customer batch production plan, some models have begun batch supply, 18 years the company's new business continues to meet our expectations.
The new business provides a broad space for development, and the company is transforming to a comprehensive solution service provider. We believe that the biggest focus of the company in the future is the electric pump with high technical barriers. The double improvement of permeability and bicycle value brought by the market of electric pump, EHPS, EPS motor and gearbox mechanical pump will provide the company with broad space for development. In addition, the company has completed the acquisition of Cacus, a supplier of noise reduction and thermal insulation products, which is conducive to its product diversification and expansion of the global market. The company gradually began to provide system solutions, from steering system components suppliers to steering, transmission, braking, automotive electronics, car body and other systems integrated service providers of auto parts.
Investment suggestion
The company used to be the leader of automobile steering pump, and its management and profitability have been maintained at a high level for a long time. At the same time, the company has a number of automotive electronic technology reserves, electric pumps and other product projects are progressing smoothly, has broken through the steering system into the transmission and braking system. The growth of the company is high, and the company realizes the development of endogenous and epitaxial two-wheel drive after the acquisition of CCI. We estimate that the company's EPS for 18-20 years will be 2.31,3.25,3.99 yuan respectively, and the corresponding share price PE will be 15.1, 10.7, 8.7 times, maintaining a "buy" rating.
Risk hint
The growth of traditional main business is lower than expected; the expansion of new projects is not as expected; the risk of integration after the acquisition of CCI.