Event
The company released its three-quarter report for 2020. From January to September 2020, the company achieved operating income of 920 million yuan, down 5% from the same period last year, and its net profit was 174 million yuan, down 6.7% from the same period last year. Among them, the company achieved operating income of 347 million yuan in the third quarter of 2020, down 0.54% from the same period last year, and its net profit was 82.94 million, down 9.56% from the same period last year, and the performance was in line with expectations.
Business analysis
The traditional main business has been gradually restored, and the business certification of membrane materials, aluminum-plastic films and electronic packaging materials has been gradually broken through.
The company's license plate film and semi-finished products business was affected by the late start of the license plate center and the downturn in the car market in the first quarter, and the company's license plate film and semi-finished products gradually recovered in April. After customer adjustment and market expansion in 2019, the company successfully entered the Hisense system and is actively expanding other well-known manufacturers. Quantum dot film actively expand the market application channels, and for downstream customers for small batch supply. The company's aluminum-plastic film business is mainly used for consumer electronics and power energy storage, and the company will actively promote the landing of certified customer orders in the future. In terms of consumer electronics packaging materials, the company's PC/PMMA composite film has been supplied in small quantities.
The construction of graphene production line continues to extend to the field of consumer electronics. The company announced on October 20 that Zhejiang Daoming Superconducting Technology Co., Ltd., a wholly-owned subsidiary, was set up to use its own capital of 48.8 million yuan to build an additional 1 million square meters of graphene film production line in Yongkang factory area. Further deepen the company's development in the field of consumer electronics. Graphene thin film, as a kind of thin film material with excellent thermal conductivity, high flexibility and light weight, has become the key material of terminal consumer electronic products in 5G era, and is more and more used in intelligent communication as thermal conductive material. The company disclosed the construction progress of the graphene project and is expected to start production gradually in April 2021.
Profit forecast and investment suggestion
We estimate that the return net profit of the company from 2020 to 2022 is 250 million yuan, 350 million yuan and 430 million yuan respectively, and the EPS is 0.4,0.56 yuan and 0.69 yuan respectively. The current market capitalization corresponds to PE of 18.2,13.1 and 10.7, maintaining the "overweight" rating.
Risk hint
Downstream customer certification is not as expected, domestic substitution progress is not as expected, research and development is not as expected.