The domestic substitution of high voltage cable material has been realized, and the continuous increment has been brought about by the commissioning of the new project. The company has a leading share of cable materials in China, in which 66KV and above high-voltage insulating materials are the direct technical difficulties of cables. in the past, high-voltage cable insulating materials all rely on Nordic Chemical and Dow overseas enterprises, and the company is the only domestic substitute enterprise. The price of overseas production capacity has risen due to the decline in supply due to technology and energy problems, and the expansion of high-voltage ring network cables and the release of sea cables during the 14th five-year Plan are very likely to continue to enlarge the gap between supply and demand. With the continuous launch of the company's new production capacity, cable materials are expected to gradually achieve domestic substitution.
High-quality charging pile operating assets, charging pile business ushered in high growth. The company's charging pile business has been laid out for many years, mainly operating vehicle charging stations, with a high proportion of high-power fast charging piles. With the growth of the number of electric vehicles and the recovery of travel, the charging operation business will continue to improve in 2023. At the same time, the company also distributes charging pile equipment sales, and cooperates more with local city investment platform. with the landing of domestic charging pile policy, charging pile sales are expected to contribute greatly in the future.
The power cable contributes to the stability increment, and the communication cable is expected to release elasticity. The company's main business is power cable, during the 14th five-year Plan period, the city carried out distribution network expansion and upgrading, power grid transformation brought stable demand growth, and the distribution side cable high-voltage trend is significant, cable business is expected to contribute to the increment. At the same time, the company also lays out communication cables, in which industrial intelligent equipment cables, including robot cables, are one of the key products of the company, and the product sales scale is increasing year by year, which will become a new growth point of the company's special cable business.
High-voltage cable materials are expected to open domestic alternative space, we predict that the company's earnings per share in 2023-2025 will be 0.61,0.76,0.86 yuan respectively, combined with the comparable company valuation level, give the company 21 times PE in 2023, the company's reasonable total market capitalization of 13.23 billion yuan, corresponding to the company's overall target price of 12.78 yuan, the first buy rating.
Risk hint
Downstream cable demand is not as expected; production capacity is not as expected; competition in the industry leads to a decline in product prices; polymer materials business development is not as expected; charging pile business development is not as expected.