Key points of investment
This Friday (April 21), “Wanfeng Shares”, a company listed on the Main Board, asked for a quote.
Wanfeng Co., Ltd. (603172): The company is mainly engaged in R&D, production and sales of disperse dyes and their filter cakes. The products are mainly middle and high-end disperse dyes. The company achieved revenue of 516 million yuan/564 million yuan/545 million yuan/545 million yuan respectively in 2020 and 2022, YOY was -23.25%/9.15%/-3.28% in that order, and the three-year compound annual revenue growth rate was -6.77%; it achieved net profit of 87 million yuan/75 million yuan/68 million yuan, YOY was -28.74%/-14.10%/-9.90% in that order. The company expects the net profit range attributable to parent company owners to be $15.548,600 to $16.6833 million in January-January 2023, an increase of 1.85% to 9.28% over the previous year.
Investment highlights: 1. The company is in a leading position in the domestic disperse dye industry, and its products are positioned in the middle and high-end fields. Disperse dyes are mainly used for dyeing and printing of polyester and their blended fabrics. They are the most widely produced and sold dye variety in China. Disperse dye production accounted for 45.57% of China's total dye production in 2021; the company's main products were disperse dyes and their filters. According to statistics from the China Dye Industry Association, the company ranked in the top ten in the national disperse dye industry in 2019-2021. The company is positioned in the middle and high-end disperse dye market. At present, it has developed three product lines: high fastness series, special series and regular series. Among the key products, high-fastness series disperse dyes, have been used in the products of Anton, Li Ning, Adidas, Nike, Uniqlo, Decathlon and other customers. 2. The company has a history of cooperation with global chemical leader Huntsman for more than ten years and has received support in terms of technology and customer resources. Although it sold its textile dyeing and dyeing division to Anggor Group in August 22, it is expected that cooperation in related businesses will continue. 1) Huntsman is one of the global chemical leaders. The company has collaborated with it since 2010. The cooperation includes cooperation on Torass products and the sale of other dyes and filter cakes. The cooperation method for other dyes and filter cakes is a normal purchase and sale business. Based on a good history of cooperation, the company signed an agreement with Huntsman Group to jointly develop the high-water wash dispersion dye market, which can be used for printing special functional textiles such as outdoor sportswear and hiking suits. 2) On August 9, 2022, Huntsman Group announced that it intends to sell its textile dyeing division to Archroma (Archroma), a subsidiary of SK CapitalPartners. Angao is a global enterprise in the field of colors and specialty chemicals. The acid dyes and active dyes it mainly produces complement the dispersive dyes of Hunssman Group. According to a further interview conducted by the intermediary with the Asian purchasing director of Angkor's dyeing division on March 1, 2023, Angao expects to work with the company after completing the acquisition of Huntsman Group's related business Continue to maintain the partnership.
Comparison with listed companies in the same industry: The company is mainly engaged in R&D, production and sales of disperse dyes and their filter cakes. The main products include disperse dyes, filter cakes and dye intermediates. According to the similarity of product structure and application uses, Zhejiang Longsheng, Runtu Co., Ltd., Jihua Group, Annuoqi, and Freixentel were selected as comparable listed companies. Looking at the comparable companies mentioned above, the average revenue size (TTM) of the industry is 6.298 billion yuan, the comparable PE-TTM (excluding negative values/arithmetic average) is 27.81X, and the gross sales margin is 20.92%. In comparison, the company's revenue scale is lower than the industry average, but the gross sales margin is higher than the industry average.
Risk warning: There is still a possibility that companies that have begun the inquiry process will not be able to go public due to special reasons; company content is mainly based on the content of prospectus and other public information; there is a risk that the selection of listed companies in the same industry is not accurate enough; there may be interpretation deviations in the selection of content data. The specific risks of listed companies are shown in the text.