Due to the impact of recoveries and impairment in 2019, the company's performance was lower than expected, the business level stabilized, and 20Q1 got off to a good start by overcoming difficulties and entering the profit repair cycle. According to the company's business plan guidelines, the company's EPS forecast for 2020-2021 is reduced to 0.03max 0.07 yuan (the original forecast is 0.07max 0.08 yuan), and the new 2022 EPS forecast is 0.08 yuan, corresponding to PE118/47/42 times, maintaining the "overweight" rating.
2019 the lower-than-expected performance was due to a reversal and impairment drag. The company's 2019 revenue / return / deduction non-return net profit is 81.46 / 0.54 trillion (year-on-year-5.69% / regular / + 93.37%, the same below), of which the revenue is affected by 412 million of the fuel cell revenue confirmed in 2018, and the revenue growth rate is + 4.04% excluding the impact of flushing back. The non-recurrent profit and loss is mainly the recognition of the investment income of 254 million yuan from the transfer of the 50% stake held by Beijing Petra Motor Drive, a wholly-owned subsidiary. In addition, the impairment loss of assets / credit impairment in 2019 was 245000,000 yuan respectively, which was a drag on the performance; the impairment of assets mainly included the provision of goodwill / inventory impairment loss of 120,000,000 yuan for subsidiaries such as Shanghai Electric Power Drive, and the credit impairment mainly resulted from the provision of bad debt loss of accounts receivable of 68 million yuan.
The growth of non-air-conditioned motors and starters and generators is improving, and motor shipments of new energy vehicles continue to increase. In 2019, the revenue of air-conditioning motor / non-air-conditioning motor / new energy vehicle motor (before flushing) / starter and engine motor revenue was 30.87 billion yuan (- 7.17% 1.22/+1.50/+2.37/+1.30pcts), and the gross profit margin was 14.51% 26.06% 23.92% 22.53% (- 12.53%) respectively. In addition to air-conditioning motors, the company's other main motor products have achieved revenue and gross profit increase, of which the terminal sales of air-conditioning motors are weak. Motor sales of new energy vehicles also increased by 7.29% to 184600 units, increasing the scale of shipments for five consecutive years. At present, the company's "two-in-one" electric drive assembly supporting the Great Wall, Renault, "three-in-one" electric drive assembly supporting Changan, Tata, Chery, Hezhong, get the modern fixed point. At the same time, the company's 48VBSG motor is equipped with SAIC GM Buick Yinglong models to achieve the coverage of different electric models.
20Q1 overcame difficulties to get off to a good start, with a slight increase in forecast results for the whole year. The company's 20Q1 realized revenue / return / deduction non-return net profit of 15.24 billion yuan (- 26.97% Universe 210.21% Universe 177.31%) and gross profit margin 21.83% (+ 2.95pcts). In the case of a year-on-year decline in revenue due to insufficient operating rate of the epidemic, the performance increased year-on-year by strengthening cost control and production efficiency. Considering the impact of the epidemic on various business-related industries this year, the company forecasts that it will achieve revenue / return net profit of 83.85 billion yuan (+ 2.93%) in 2020.
Risk factors: sales of new energy vehicles are lower than expected, raw material prices fluctuate more than expected, and asset impairment exceeds expectations.
Investment advice: the company's performance in 2019 was lower than expected due to the impact of recoveries and impairment, the business level stabilized, and 20Q1 overcame difficulties to get off to a good start and enter the profit repair cycle. According to the company's business plan guidelines, the company's EPS forecast for 2020-2021 is reduced to 0.03max 0.07 yuan (the original forecast is 0.07max 0.08 yuan), and the new 2022 EPS forecast is 0.08 yuan, corresponding to PE118/47/42 times, maintaining the "overweight" rating.
