With the upgrading of mechatronics, the performance will eventually spiral from 2013 to 2019, and the company's operating income has successfully grown from 600 million yuan in mechanical pumps to 4 billion yuan in mechatronics multi-category. Among them, the revenue inflection point was brought about by mergers and acquisitions and the release of new products in 2017, and the performance fell short of expectations due to industry stall and cost problems in various periods since the second half of 2018. As the road of product upgrading gets better in 2020, the moderate recovery of the industry and the resolution of cost problems will be realized in turn. It is expected that the company's core financial indicators such as gross profit margin and net profit margin will improve significantly, and the performance will eventually spiral upward.
Merger and acquisition of Germany's CCI, NVH big niche Blue Ocean Company's acquisition of Germany's CCI in 2016, the smooth realization of the shift from a smaller vehicle market to a pump market to a larger capacity NVH parts market, thus significantly thickening the income scale, stabilizing the gross profit center in the medium term, as well as the opportunity to get in touch with more overseas high-end customers and international layout, to iron out the erosion of profitability caused by fluctuations in the domestic car market in the long run.
For the company, it has become a fact that HPS has been gradually replaced by EPS in the field of passenger cars, but EHPS is a better choice for pure electric commercial vehicles, and it is also an excellent solution for hybrid passenger vehicles to be compatible with high torque and retain the sense of driving control. We expect that the company's electro-hydraulic pump production capacity is too tight, the company may achieve full production and revenue contribution of 550 million-600 million yuan in 2021, and the long-term gross profit margin is expected to exceed 30%. We are also optimistic about the extension space of the company's products in the transmission system. The production capacity of 1.5 million automatic transmission pumps can support about 300 million yuan of income, and the gross profit margin is expected to be quickly repaired to a reasonable range of 20% 25%. The supply prospect of brushless small DC motors in large transmission assemblies is also broad.
EOP to APA, mechatronics moves towards autopilot as an auto parts system supplier, the company closely follows the development trend of automobile intelligence, constantly enriches the product line, and has realized the integration from mechanical pump + motor-electric control to all kinds of electric pumps. finally, the system is integrated into the iterative upgrade of L2 self-driving products. The company's core brushless DC motor with ultra-low noise, high efficiency and high performance can be supplied in batches for five major systems: power, steering, transmission, braking and thermal management. in addition to EPHS of steering system, EOP of transmission system, EWP of thermal management and PEPS of power system, the integration of brake, parking and energy storage motor of braking system is blooming and bearing fruit through self-driving executive terminal such as APA. We believe that only through mechatronics to deep ploughing the executive end of the system integration, directly as a first-class supplier into the pre-assembly supporting system, is a more feasible autopilot path.
Earnings forecast and investment rating: the first time to cover, give a buy rating, the company is expected to be 2019, 2020, EPS will be 0.80, 2020, and 1.90, corresponding to the current (closing on December 30) share price PE is 55-32-23 times, the first coverage, given a "buy" rating. We believe that Del shares is a rare successful example of domestic expansion from mechanical products to mechatronics, coupled with the extension of mergers and acquisitions have brought more high-end and international opportunities, the company's EHPS, automatic transmission pumps, EOP, EWP, PEPS, APA, NVH and many other categories have a broad market space, the door of long-term growth has been slowly opened.
Risk hints: the risk that the expansion of new products is less than expected; the risk that sales in the automobile market fall short of expectations; the risk that the performance of the acquisition target is not as expected; and the risk that the construction of fund-raising projects is not as expected.