I. Overview of events
On July 9, the company issued a forecast of its mid-year report in 2020, which is expected to make a profit of 30 million yuan to 33 million yuan, an increase of 1656% to 1832% over the same period last year.
II. Analysis and judgment
The China News is expected to increase sharply and is optimistic about the high growth for the whole year.
In the first half of 2020, the company expects to make a profit of 30 million yuan to 33 million yuan, an increase of 1656% to 1832% over the same period last year, mainly due to the outstanding growth of airborne protective armor business and the growth of profits in the main business. In the first half of the year, the company achieved both epidemic prevention and control and scientific research and production, and the acquisition of major business opportunities and business development progressed smoothly, and we expect the annual performance to achieve rapid growth.
Core supplier of military helicopter seats, rich range of military and civilian products
The company's main business includes airborne equipment development and airborne equipment maintenance, which is mainly military business. The company is the core supplier of anti-crash seats for domestic military helicopters, the products basically cover a full range of military helicopters, and continue to expand in transport aircraft and multi-purpose aircraft. At present, the company's product reserve is sufficient, a total of 13 product lines, including 7 military and 6 civilian. Gradually getting orders for the products under research will continue to promote the rapid development of the company.
The model under research continues to fall to the ground, and the cabin center exceeds the seat center.
The development field of the company's military airborne equipment is divided into seat center, cabin center and navigation center, in which the seat center is the civil and military aviation seat, the products of the cabin center include cabin products, airborne armor, and the navigation center includes navigation, actual combat system and so on. At present, the increment of the company's seat business mainly comes from the new helicopter, which will show a steady growth trend in the future. With the landing of many projects, the revenue of cabin products will exceed that of seat products. In 2020, the airborne armored business will expand again after 18 years; the cabin project of a certain military transport aircraft and the actual combat system will be ordered for the first time, and subsequent orders are expected to continue to grow.
Reached a maintenance cooperation agreement with Honeywell International Inc, accompanied by the expansion of the support system.
Airborne equipment maintenance is also one of the company's core business, which mainly includes equipment maintenance and modification. At present, it has CAAC, EASA, FAA, JMM and other maintenance licenses, which can provide high-quality aviation airborne equipment maintenance services for more than 30 aircraft types, such as Boeing Co series, Airbus series, regional airliners and helicopters. In 2019, the company reached a strategic cooperation with Honeywell International Inc to become its authorized domestic maintenance unit, which will promote the development of the company's airborne equipment maintenance business in the future. In addition, the company's original measurement and control business is divided into the security center and the measurement and control center, the helicopter accompanying support system has made a major breakthrough, it will be equipped in the helicopter users, is expected to continue to release capacity in the future.
III. Investment suggestions
As the leader of domestic helicopter anti-crash seats, the cabin business is developing rapidly. With the expansion of a number of models under research, we are optimistic about the rapid development of the company. It is estimated that the EPS of the company in 2020-2022 is 0.40,0.50 and 0.62 yuan respectively, corresponding to the PE of 37X, 30X and 24x. The average valuation of the comparable company is 57X, with a "recommended" rating.
IV. Risk hints
1, the order of the actual combat system is lower than expected; 2, the promotion of the accompanying support system is slow