The performance of China News is excellent, and the high growth is expected for the whole year. In the first half of 2016, Lucky Film achieved operating income of 690 million yuan, + 38.7% year-on-year, 55% of the annual target; total profit of 35.02 million yuan, + 131.6% of the same period last year, and 77.8% of the annual target; net profit of 29.56 million yuan, + 202.1% of the same period last year; export earnings of US $13.14 million; return on net assets of 1.95%.
The comprehensive gross profit margin of the main business decreased slightly, but the itemized gross profit margin increased, and the rate of three fees and expenses declined steadily. China Daily reported that the comprehensive gross profit margin of the main business decreased slightly, 16.88%, year-on-year-0.36pct, but from a sub-industry point of view, the itemized gross profit margin increased, including photosensitive industry gross profit margin 23.4%, year-on-year + 1.60pct, photovoltaic industry 8.93%, year-on-year + 4.10pct; total expense rate 12.77%, year-on-year-1.3pct Among them, sales expenses 5.75%, year-on-year-0.5pct, management expenses 7%, year-on-year-0.82pct, financial expenses 0.02%, year-on-year-0.02pct, the overall steady decline in the rate of three fees.
In terms of products, the company's revenue growth is mainly due to a sharp increase in solar cell backpanel sales. The company's main business products include photosensitive industry and photovoltaic industry, including color photographic paper, photographic chemical materials and other categories, with revenue of 3.43 / 0.21 / 14 million yuan, + 4.8% / + 4.4% /-7.8% respectively, gross profit margin of 22.5% / 50.7% / 6.25%, + 1.59 / + 2.63 /-1.47pct respectively. The photovoltaic industry includes solar cell backplane products, with revenue of 310 million yuan, year-on-year + 136%, gross profit margin of 8.93%, year-on-year + 4.10pct.
High-performance wet-process lithium diaphragm and high value-added coating film are expected to be released gradually. The new energy industry chain has driven the sustained high growth of the lithium diaphragm industry (the domestic output of lithium separators increased by 50% in 2015), and the rising proportion of ternary power batteries has driven the demand for wet membrane process. Relying on the core technologies such as film forming, coating and particles accumulated in the color film and photographic paper industry for many years, the company is expected to break the foreign monopoly and realize the localization and serialization of high-performance lithium-ion battery separators. to provide high-performance products to the domestic consumer electronics and aerospace fields. At present, 92.8% of the first phase of the lithium diaphragm coating production line has been completed, 47.1% of the high-performance lithium ion battery PE diaphragm project has been completed, and 54.4% of the solar cell backplane fourth phase expansion project-No. 8 production line has been completed. The lithium power project has been carried out smoothly and has entered the commissioning stage, and it is expected that it will contribute to the performance in 2016.
The group's minimum market capitalization listing platform is expected to benefit from the increase in the securitization rate of the group. The company group proposed that the asset securitization rate should be greatly increased from 15% to 45% during the 13th five-year Plan period. as the listing platform of the group's smallest market capitalization (6.2 billion yuan), we expect the company to become the capital operation platform for the group's new materials and new energy. it is expected to expand the industrial chain, enrich product types, and become the target of new energy benefits, with greater flexibility in imagination and market value.
The current stock price is upside down. The subscription price is 19.36 yuan, and the current stock price is about 14% upside down. We think the company's stock price is undervalued.
Profit forecast and investment advice:
It is optimistic that the solar cell backplane + wet lithium battery diaphragm and coated film will gradually promote the company's high growth in the future, and slightly revise the valuation. It is estimated that the EPS for 2016-2018 will be 0.17 shock 0.26 amp 0.37 yuan, corresponding to PE 99 amp 63max 45X, maintaining the "overweight" rating.
Risk hint: lithium diaphragm project is lower than expected; capital operation is lower than expected.