Event: the company released its results for the first three years of 2020. during the reporting period, the company achieved operating income of 1.275 billion yuan, an increase of 15.11% over the same period last year. The net profit belonging to shareholders of listed companies was 231 million yuan, up 23.80% from the same period last year; the net profit belonging to shareholders of listed companies after deducting non-recurring profits and losses was 220 million yuan, up 24.33% from the same period last year.
Main points of investment
The industrial transportation leads the military enterprise, the performance maintains the rapid growth: the company specializes in the rubber conveyor belt series product research and development, the production and the sale for more than 30 years, in the rubber industry association industry ranks first among the "top ten conveyor belt enterprises in China" for nine consecutive years, the products are widely used in coal, steel, port, cement, electric power and other industries, the consumption of conveyor belts in the above five industries accounts for about 90% of the total consumption. During the reporting period, the company achieved a net profit of 231 million yuan, an increase of 23.80% over the same period last year, maintaining a good trend of development.
The scale of production capacity has increased significantly, and long-distance conveyor belts meet new opportunities for development: the company's "high-strength conveyor belt project with an annual output of 10 million square meters" has been put into production in May 2020, which has further expanded the production capacity of the conveyor belt. greatly alleviate the situation of insufficient production capacity in the early stage of the company. At the same time, the company acquired an 80% stake in Zhejiang Huaneng Transmission Technology Co., Ltd. with 60 million yuan in April 2020, further increasing the production capacity of the company's conveyor belt. In addition, with the improvement of motor vehicle emission supervision in China, the supervision of heavily polluting diesel trucks is becoming increasingly stringent, and the company's products represented by long-distance conveyor belts may usher in new opportunities for development.
Light assets layout pension industry, actively establish an industrial benchmark: the company actively in accordance with the strategic concept of "adhere to light assets, enlarge the pension industry, build a well-known brand in combination with medical care", promote the company to expand with the mode of light assets for the aged, and continue to increase market development efforts on the basis of ensuring the quality and stability of service. During the reporting period, the business income of Tongxiang Heji Sanatorium (welfare center headquarters), Tongxiang Heji Sanatorium (Fengming Branch), Suzhou Hongri, and Jishengyuan outpatient departments increased steadily. Tongxiang Heji Summer Home Co., Ltd. reached a medical technical cooperation agreement with Tongxiang first people's Hospital and established a comprehensive partnership. The Zhouquan Nursing Home under Tongxiang Hefei Home has also started trial operation, and the company's "combination of medicine and care" model in pension services is being gradually promoted.
Profit forecast and investment rating: we expect the company's net profit from 2020 to 2022 to be 303 million yuan, 366 million yuan and 453 million yuan respectively, and the EPS is 0.74 yuan, 0.89 yuan and 1.10 yuan respectively. The current share price corresponds to 14x, 11x and 9x respectively. Maintain a "buy" rating.
Risk hint: the progress of new capacity is lower than expected, market demand is declining, and raw material prices fluctuate sharply.