Introduction to this report: it is expected that the IPO issue price of Yuxin shares is 39.99yuan, it is recommended to apply for it as soon as possible.
Abstract:
According to Yuxin's letter of intent, the company's IPO expects to raise 1 billion yuan, offering underwriting and other expenses totaling 133.3166 million yuan, totaling 1.1333166 billion yuan. In the audited 2019 annual report, the net profit attributable to the owner of the parent company is 234.6774 million yuan after deducting non-recurring profits and losses, and the diluted EPS is 2.07 yuan. It plans to issue 28.34 million shares, which is calculated at a price of 39.99 yuan per share based on the total amount of capital raised, and the corresponding PE is 19.31 times.
Corresponding to the C26 industry (C26) nearly a month static PE is 16.81times, Yuxin share raising price corresponding to the PE is higher than the industry PE. Yuxin shares may be delayed for three weeks, and the IPO offering price is expected to be 39.99 yuan. It is recommended to apply for the shares as soon as possible.
Yuxin shares is the leader of LPG deep processing enterprises in South China, with obvious location advantages. The company's main business is the process research, development, production and sales of organic chemical products based on LPG, the main products include isooctane and methyl tert-butyl ether, and the downstream is mainly used in the production of finished gasoline.
The company's products are mainly sold in South China (revenue accounts for more than 60%). At present, isooctane in South China is in short supply, and the market price of products is higher than that in other parts of the country. At the same time, at present, the supply of LPG raw materials in the upstream of isooctane in China is tight. The company's production equipment is located in Huizhou Daya Bay petrochemical area, close to China Shell and CNOOC Huizhou Petrochemical. The company has signed a long-term strategic cooperation agreement with the above two enterprises, and built a LPG pipeline directly connected to the production devices of both sides, which has an adequate supply of raw materials and can achieve circular economy, effectively reducing the cost of raw materials. Improve the profitability of enterprises. In the future, with the comprehensive promotion of high-standard gasoline, such as the fifth and sixth grade gasoline, the market demand for isooctane will further increase.
Considering the disclosure of the prospectus and the above analysis, we choose 603026.SH and 002408.SZ as comparable companies with an average price-to-earnings ratio of 20.41 in 2019. According to the amount of capital raised announced in the letter of intent, the offering price of Yuxin shares is 39.99 yuan, corresponding to 19.31 times the return net profit PE in the 2019 annual report. The valuation of Yuxin shares is higher than the industry PE and lower than the average PE of comparable companies. It is expected that the offering may be delayed by three weeks. It is estimated that the total share capital after the issue will not exceed 113 million shares, and the market value after the issue is estimated to be 4.532 billion yuan.
Risk hints: (1) the release rhythm of IPO is delayed by force majeure; (2) the fluctuation of macroeconomic and international crude oil price level affects the performance stability of the company.