This report is read as follows:
The post-cycle attribute of the subway information industry is obvious, and we expect that the year after next year will be a big year of Beihai communication performance, and the order growth will exceed market expectations. The company's product upgrading has brought a significant increase in bicycle value, which is worth looking forward to in the future.
Main points of investment:
Maintain the overweight rating and maintain the target price of 6.80 yuan. The EPS from 2018 to 2020 is 0.20, 0.17 and 0.24 yuan, respectively.
The post-cycle attribute of the subway information industry is obvious, and the year after next year will significantly benefit from the new peak of the subway from 2015 to 2016. Subway from design to construction and then to operation, usually takes five years, the third year began to purchase PIS system. The mileage of subway construction increased by 636km in 2015, an increase of 234.74% over the same period last year. In 2016, the mileage of subway construction increased by 1135 km, an increase of 78.46% over the same period last year. Therefore, the year after next year will be a big year for Beihai Communications performance of Century Ruier subsidiary, and the growth of orders and revenue will exceed market expectations.
Product upgrading brings an increase in unit price, and the value of bicycles will increase significantly. PIS system mainly includes dynamic map, camera and broadcast system. At present, the company's dynamic map is being upgraded to the LCD screen, and the unit price is expected to rise from about 2000 yuan to more than 5000 yuan. According to the 10 doors of a model A car and six carriages of a subway, the value of a single subway will increase by 180000 yuan.
The competition pattern of the industry is good, and fully enjoy the promotion of the industry boom. The downstream customers of the subway information industry are the subsidiary depots of CRRC. At the same time, the local railway bureaus, as owners, also have the right to make suggestions, and the competition pattern is relatively stable. At present, Beihai Communication, a subsidiary of Century Ruier, ranks first in the market share of the subway PIS industry, and will share the industry prosperity and enhance the dividend in the future.
Risk hint: the risk that the investment in railway infrastructure is less than expected and the risk of intensified competition in the industry
