The double main businesses of "Industrial Environmental Protection + Internet" go hand in hand, and the company's management is improved.
The company is the leading enterprise of domestic comprehensive industrial equipment anti-wear and anti-corrosion products production and technical services, engaged in anti-wear and anti-corrosion business for 25 years, is the only listed company in the industry, but also the maker of industry standards, the absolute industry leader. In 2017, the company expanded its garbage stove protection and acoustic noise reduction business while implementing extension expansion, strategically acquiring two Internet companies, "Wuhan Feiyou" and "Changsha Jufeng", and its operating revenue increased from 148 million yuan at the bottom of 2016 to 259 million yuan in 2017. Gross profit margin increased from 27% in 2016 to 40% in 2017. Indicators such as operating cash flow, period expense rate and operating efficiency have also shown significant improvement, and the business pattern of "industrial environmental protection + Internet" has initially taken shape, which plays a significant role in improving the company's operation.
The strength of the traditional main industry is strong, and the high growth of garbage stove protection business is expected.
The company has set up the first "anti-wear and anti-corrosion postdoctoral research station" in China since 2006. after more than 10 years of efforts, it has obtained 49 authorized patents and 60 software copyrights, and has become the benchmark maker of the anti-wear and anti-corrosion industry. It has a very high position and competitive strength in the industry. In the field of garbage furnace protection business, with years of accumulated R & D strength, the company has become one of the few domestic enterprises that master waste incinerator protection technology and have the ability to carry out large-scale construction. The company has obtained more than 15 million yuan in orders in 2017 and more than 30 million yuan in new orders from January to September 2018, and has provided long-term anti-wear and anti-corrosion technical services for waste incineration boilers for many large enterprises, such as Jinjiang Group, Everbright International, Guangzhou Shenzhen Energy, Kang Heng Environment, Hanlan Environment and so on. At present, the anti-corrosion area of the company's machinable waste incinerator is about 26,000-30,000 square meters / year. In the later stage, according to the advance of the order, it is proposed to expand production to 45,000-50000 square meters / year. Under the background of favorable industrial policy and incineration gradually occupying the mainstream industry, facing a capacity market of 7.8 billion, the company is expected to quickly occupy the market, and there is a lot of room for business increment.
Proactive layout has achieved initial results, and acoustic noise reduction orders have increased.
The company established Evergrande Acoustics in 2006 to carry out research and development and layout in the field of acoustic environmental protection. In early 2015, the wholly-owned acquisition of Evergrande Acoustics was incorporated into the company. The company has made great efforts to develop its acoustics business and has made breakthroughs in the prevention and control of noise pollution in rail transit, which has improved the overall competitiveness of the company. In recent years, the acoustics performance of Evergrande has increased significantly, and its contribution to the company's performance has increased year by year. The revenue of the acoustics business sector has increased from 13 million yuan in 2015 to more than 26 million yuan in 2017, with a compound growth rate of 42.32%. Gross profit margin has also increased from 9.25% in the lower reaches of 16 years to 14.76% in 2017.
The performance commitment of the Internet marketing sector is good, and is optimistic about the long-term development of the company.
After a long period of hard work in the field of Internet marketing, the two subsidiaries of Wuhan Feiyou and Changsha Jufeng have established long-term and deep cooperative relations with upstream Internet giants such as Baidu, Inc., BABA, Tencent, Sun and Moon peers, and have gathered rich and high-quality media resources. In 2016 and 2017, the merger and acquisition bids exceeded their performance commitments, and 2018 is expected to continue to be good. We are optimistic about the long-term development of the company, which is expected to achieve revenue of 3.29,6.05 and 835 million yuan from 2018 to 2020; net profit of 0.42,1.17 and 164 million yuan; EPS0.14, 0.38,0.53 yuan, covering for the first time and giving a "buy" rating.
Risk analysis.
The risk of the lower-than-expected performance of the acquisition targets "Wuhan Flying Tour" and "Changsha Jufeng"
Market orders release lower-than-expected risks
The financing environment is the risk of timely improvement.
Risk of failure to collect money on time leading to provision for repayment and financial strain caused by project advances