Event: the company issued a forecast for the third quarterly report of 2018, and estimated that the net profit from January to September in 2018 is 3.27-393 million yuan, an increase of 50-80% over the same period last year. Of this total, the net profit of Q3 was 1.27-155 million yuan, an increase of 80-120% over the same period last year, and-22.78%-5.63% compared with the previous year.
The company expects that the impact of non-recurring profit and loss on net profit in the first three quarters of 2018 is about 60.88 million yuan, and the net profit deducted from non-return in January-September 2018 is expected to be 2.66-332 million yuan, an increase of 25.46%-56.28% over the same period last year. Of this total, Q3 deducted non-return net profit of 1.23-151 million yuan, an increase of 74.09%-114.18% over the same period last year and 9.57%-34.80% month-on-month growth.
The product application field expands the superimposed RMB exchange rate depreciation to improve the company's performance. The Q1, Q2 and Q3 of the company deducted non-return net profit of 0.48,1.12,1.23-151 million yuan in a single quarter, respectively. On the one hand, due to the gradual expansion of the application field of the company's products, the rapid volume was released after entering the smart home industry this year, which boosted the company's performance. On the other hand, the exchange rate of the US dollar against RMB went out of the V-shape this year, and experienced a change of 6.56.36.66.9 in January-June-September. The exchange rate trend of the Hong Kong dollar against the RMB is similar. More than 35% of the company's revenue comes from overseas, the core subsidiary Weifeng International uses Hong Kong dollars to settle accounts, and the devaluation of the RMB improves the company's performance.
The troika helps the company develop rapidly. (1) Light conveyor belt business: the company is the leading enterprise in the domestic light conveyor belt industry. The net profit of 2018H1 is 35.33 million yuan, + 18.56% compared with the same period last year, and the growth rate is expected to further increase in the first three quarters. (2) Yingdong Molding focuses on the automobile industry, and its main customers are FAW Toyota, Shanghai Volkswagen, Shanghai GM, Tesla, Inc. and other automobile manufacturers.
Benefiting from the growth in car sales of the company's core customers and the rapid volume of Tesla, Inc., the net profit of 2018H1 is 42.3 million yuan, + 32.51% compared with the same period last year, and continues to expand rapidly in the third quarter. (3) Weifeng International continues to expand its industrial category and rapidly expand its volume after entering the smart home industry this year to provide new growth points.
Maintain a "buy" investment rating. It is predicted that the net profit of the company from 2018 to 2020 is 422 million yuan, 435 million yuan and 513 million yuan respectively, and the EPS is 0.52,0.53,0.63 yuan respectively, and the corresponding PE is 9 times, 9 times and 7 times respectively. Maintain a "buy" rating.
Risk hint: the risk of declining sales in the automotive industry and lower-than-expected product expansion.