Events:

2019H1 realized operating income of 823 million yuan, a decrease of 30.51% compared with the same period last year. The net profit attributed to the shareholders of listed companies was 25.12 million yuan, down 32.26% from the same period last year. The net profit of 2019H1 was 10.15 million yuan, down 66.54% from the same period last year. Among them, 2019Q2 realized net profit of 5.17 million yuan after deducting non-return, and YOY+220%, increased by 4% month-on-month.

Comments:

1.Q2 net profit decreased compared with the same period last year, but the non-homed net profit increased again, and the cash flow of H1 business activities improved significantly. 2018Q2 realized a net profit of 8.71 million yuan, including 7.09 million yuan in non-recurrent income (mainly 8.82 million yuan in government subsidies included in profits and losses in the current quarter), while the performance of the main business was only 1.62 million yuan in real terms. 2019Q1 realized a net profit of 22.28 million yuan, including 17.3 million yuan in non-recurrent income (mainly 21.22 million yuan in government subsidies included in profits and losses in the current quarter), while the performance of the main business was only 4.98 million yuan in real terms. 2019Q deducted non-home net profit of 5.17 million yuan, an increase of 220% over the same period last year and 4% month-on-month growth. There was a net cash inflow of 117 million yuan from operating activities, compared with a net outflow of 184 million yuan in the same period last year.

two。 Lithium power equipment business contributes to the company's core profits. Haoneng Technology 2019H1 revenue of 381 million, net profit of 30.25 million yuan, contributing to the company's total net profit, in line with expectations. At present, Hao Neng has an order of more than 1 billion yuan, and we expect that with the large-scale start-up of 2019H2 domestic battery plant expansion plan, Haoneng Technology will continue to benefit and contribute to the company's core growth power.

3. The price of cathode materials has fallen sharply, and major customers are looking forward to turning around after the introduction. The company's 2019H1 lithium cathode materials achieved an operating income of 384 million yuan, a decrease of 54.61% over the same period last year, of which Yingde Keheng 2019H1 achieved an income of 151 million yuan and a loss of 7.99 million yuan, mainly due to a sharp drop in material prices and a slowdown in the customer introduction process. It is expected that it will improve in the second half of the year as the customer introduction is completed.

Considering that the price of lithium cathode materials continues to decline sharply this year, and the company's major customers are affected by industry production reduction to a certain extent, the company's profit forecast is adjusted downwards. it is estimated that the company's net profit in 2019-2021 is 0.81,1.29,180 million yuan respectively, EPS is 0.38,0.61,0.85 yuan respectively, corresponding to PE is 38,24,17 times respectively, give "buy" rating!

Risk hint: Xinneng car sales are not as expected.