This report is read as follows:
Downstream investment continued the upward trend, driving the company's revenue and orders continued to grow, 18 years of new effective orders increased by 27%, looking forward to the robot to inject transformation and upgrading "new momentum".
Main points of investment:
Conclusion: the downstream investment boom continues the upward trend, the company's revenue and orders continue to grow, and new orders have increased by 27% in the past 18 years. Robots are expected to inject new kinetic energy. It is estimated that the return profit in 2019-21 will be 1.69,1.91,217 million, and 0.039max 0.044max for EPS. Based on the high growth of the company's robot business in the future, with reference to the industry average PB level (19H1 average PB 2.6X), and taking into account the good growth of robot business in the future, a certain premium should be given to 19H1 2.8x PB, the target price 4.67RMB, and the rating of "prudent increase".
Downstream investment boom upward, driving the industry to continue to pick up. The downstream of the company's products are mainly used in the mining and building materials industry. since 2017, mining profits have bottomed out and rebounded, increasing by 2.6 times and 40% respectively in 2017-18. Revenue and total profits increased by 5.3% and 4.2% respectively, and the profit margin (total profit / revenue caliber) reached 12.9%. In addition, the caliber of the Bureau of Statistics shows that the number of enterprises above scale continues to decrease, and the overlaying demand for production capacity is expected to catalyze production expansion. Drive the demand for heavy machinery to warm up.
The company's revenue and orders continue to grow, and the operating efficiency has been greatly improved. In 18 years, the company achieved revenue of 5.2 billion, an increase of 12.6%, a return profit of 106 million, and a net interest rate of 2.0%, a sharp increase over the same period last year.
Under the background of the continuous recovery of the downstream industry, the company is taking orders well, with an increase of 27% in 18 years compared with the same period last year, ensuring 19 years of growth. At the operational level, on the one hand, the company continues to promote deleveraging, and the net interest-bearing liabilities (interest-bearing liabilities-monetary funds) decline steadily; on the other hand, it reduces procurement and management costs, and the 18-year expense rate decreases significantly. Under the lower profit level, the future profit is more flexible.
High steel prices erode gross profits and look forward to the "new kinetic energy" of robots. Steel prices remain high, and the gross profit margin of all sectors of the company has declined in the past 18 years, with a comprehensive gross profit margin of 24.5%, a year-on-year decline of 2.6pct. The company is the leader of special robots in China, with revenue of 1 billion from robots and intelligent equipment in the past 18 years, gross profit of 44.8% and net profit of nearly 200 million. We look forward to injecting new momentum into the transformation and upgrading of the company.
Risk hint: intensified competition in the industry and persistently high prices of raw materials