Main points of investment:
The company's main business is the research and development and application of steel reinforced plastic composite pipe technology, providing customers with a complete set of production process, technical solutions and complete sets of production equipment (production line). The company's main products are two categories, namely winding steel wire reinforced pipe production line and steel strip reinforced plastic pipe production line. Among them, the most important one is the steel strip reinforced plastic pipe production line, which accounts for 63.72%, 53.40% and 66.66% of the revenue from 2012 to 2014, respectively. The total income of the winding steel wire reinforced pipe production line and the steel strip reinforced plastic pipe production line reaches more than 90% of the total income, which constitutes the most important source of profit for the company. As the company's products accumulate more and more word-of-mouth, technology and experience in the market, as well as the continuous research and development of new technologies, new products and new systems, the company has good prospects for future development.
The company focuses on technology research and development and new product innovation, with core technology products accounting for more than 97% of revenue during the reporting period. The company is fully summing up many years of design and production experience, and has a number of patents and independent research and development of the technical system. The company has 43 national patents, including 17 patents for steel strip reinforced plastic pipes, 10 patents for wound steel wire reinforced pipes, and 16 patents still under development. Through the protection and application of these independent R & D technologies, the company has its own brand advantages and occupies a high-end industrial chain. Compared with the main domestic competitors, the core competitiveness of the company is to develop new pipes for new requirements, and to design technical solutions and complete production lines for new pipes, guide and participate in the formulation of industry standards.
Steel reinforced plastic composite pipeline industry has a wide market capacity. From 2006 to 2010, the output of plastic pipes in China developed rapidly with a compound growth rate of 30.68%. Among them, the market of steel reinforced plastic composite pipe is the fastest growing field in recent years. It is estimated that in 2015, the output of industrial plastic pipes in China will reach 750000 tons, with a compound growth rate of 13.4 percent, of which the consumption of steel reinforced plastic composite pipes will reach more than 100000 tons. In addition, a large number of applications of steel reinforced plastic composite pipes in municipal construction, agricultural irrigation, mining development and other fields will also lead to an increase in the demand for complete sets of equipment.
All the funds raised will be invested in projects related to the company's main business. After the fund-raising project reaches production, the company will add 60 sets of steel strip reinforced plastic pipe production line and 36 sets of winding steel wire reinforced pipe production line every year, so as to further establish the company's leading position in the industry and improve profitability and competitiveness. It is expected that after the industrialization project of steel strip reinforced plastic pipe production line and winding steel wire reinforced pipe production line reaches production, the company will increase its annual business income by 162 million yuan and net profit by 29.1128 million yuan, with obvious economic benefits.
Risk revelation. The main risk of the company comes from the uncertainty of economic environment, the adjustment of national industrial structure and the risk of single product and intensified competition.
We estimate that the fully diluted EPS of the company for 15, 16 and 17 years is 0.51,0.60 and 0.72 yuan (based on the total share capital of 68 million shares after the issuance of 17 million new shares). Based on the principle of caution, we give a valuation of 20-25 times PE for 15 years, with a reasonable price range of 10.20-12.75 yuan.
Special note: the IPO pricing predicted in this report is not the price performance on the first day of listing, but a reasonable price range when the existing market environment remains basically unchanged.
