Event: the company released its semi-annual report that its first-half income was 1.078 billion yuan, an increase of 2.01% over the same period last year; net profit was 176 million yuan, an increase of 31.93% over the same period last year; non-net profit was 140 million yuan, an increase of 38.49% over the same period last year, exceeding market expectations.
Revenue in a single quarter reached a record high, and the superimposed gross profit margin continued to improve and exceeded expectations: Q1 is a special case this year. With reference to the company's local regulations, we expect to translate into a complete working day of about 50 days, affecting production, and Q2 returned to normal. Quarterly income of 652 million yuan, month-on-month growth of about 50%, indicating that orders are full and the harvest rate is high. At the same time, the company's gross profit margin upward logic continues to cash, Q2 single-quarter gross profit margin 36.18%, year-on-year growth of 5.41pct, electrode foil self-sufficiency rate, product structure adjustment and other positive factors continue to play a role. Looking forward to the second half of the year, the mobile phone industry chain is expected to gradually recover. Under the trend of accelerated infiltration of high-power fast charging, consumer business ASP has increased significantly; the previous convertible bond project is expected to be put into production in the second half of the year, further expanding the application of industrial and automotive electronics in emerging fields, and driving the company's income to maintain rapid growth.
The rising trend of charging power in the 5G era has been established, and the boom is expected to continue to rise: the power consumption of 5G mobile phones will superimpose consumers' demand for fast charging and increase the power of mobile phone charging heads. in 2019, flagship models are generally dominated by 30-40W fast charging, and 5G flagship models have raised their power to 55W and 65W in the first half of 2020, driving up the volume and price of supporting capacitors. According to the disassembly data, the 65W charge head ASP is more than 50% higher than the 40W.
The company is the core capacitor supplier of 3C power products in China. Since 2019, the direct supply of major customers has made a major breakthrough, and the share continues to increase. The company is also actively expanding notebook power and other markets, will further open up the growth space of consumer products. On the supply side, the investment in aluminum electrolysis by the Japanese Big three has gradually decreased in recent years, while the demand side has increased steadily, superimposed by the improvement of domestic manufacturers' awareness of self-control, providing a good industrial environment for domestic leading suppliers to continue to make breakthroughs. Solid-state and other high-end product breakthroughs are worth looking forward to.
Ploughing the upper and lower reaches of the industrial chain to continuously strengthen competitive advantages. The company has upstream core equipment design capability, by promoting all-in-one machines and other equipment, continue to improve the level of automation, per capita output is expected to double in the future, convertible bond fund-raising new factory is designed according to this standard, is expected to be put into production in the second half of this year, when income increases while labor costs are expected to be reduced At the same time, the company continues to improve the self-sufficiency rate of core raw materials, and the profitability center is expected to rise, which has been gradually verified since 2019, and there is still room for further improvement.
Investment suggestion: the company benefits from the fast-charging high-power trend, while new capacity is about to be launched, accelerating the expansion of automotive electronics, industry and other fields, and the performance acceleration trend is obvious. we expect the company's annual net profit in 2020-21-22 to be 406pm 501pm 606 million yuan, EPS 1.04 / 1.29ppt 1.55 yuan, with a growth rate of 20.24%, 23.52%, 20.86%, and "Buy" rating.
Risk tips: low expectations for capacity release, low expectations for high-end market expansion, and a sharp decline in mobile phone shipments.