The domestic cooling tower is absolutely the leader, and the order is sufficient and the profit reaches a new high. The company ploughed the cooling tower for 30 years, focused on the one-stop service of the cooling tower, was selected as the "single champion demonstration enterprise" of the national manufacturing industry, continued to consolidate its leading position in China and actively expanded overseas, and set up subsidiaries in the United States, Indonesia, South Korea, Thailand and other places. From 2018 to 2022, the company's operating income increased from 604 million yuan to 1.354 billion yuan, CAGR reached 22.36%; net profit from 33.1877 million yuan to 73.7523 million yuan, CAGR of 22.09%, maintaining rapid growth.
The cooling tower has a broad market space, and the company has multi-dimensional advantages to build competitiveness. Cooling tower is an important supporting facility in modern industry, which is widely used in petrochemical, metallurgical, electric power and other fields. The market space of cooling towers in China is nearly 20 billion, but the industry concentration is low, and the technical level of small manufacturers is backward and difficult to meet the needs of large supporting projects. As the leader of the domestic cooling tower, the company has the leading technical strength, high-quality customer resources, and the layout of 70 overseas countries and regions, has formed a global service capacity; at the moment when the demand downstream of the cooling tower is gradually expanding, the company's advantages are expected to be translated into dividends.
Power + calculation investment accelerates, driving the demand of cooling tower. 1) Thermal power: power guarantee for accelerating thermal power investment, thermal power cooling towers are expected to speed up in the next two years, and the company's outstanding capacity is expected to expand market share; 2) Nuclear power: stringent environmental requirements and inland nuclear power construction will drive the demand for nuclear cooling towers. As a qualified supplier of CNNC, the company is expected to benefit from the rapid rise of nuclear power cooling tower demand. 3) Energy storage: the cooling tower as the outdoor unit of the energy storage liquid cooling scheme may usher in a wide space; 4) data center: the development of AI drives the construction of the data center, and the cooling tower is an indispensable key component of the liquid cooling data center.
Investment suggestion and valuation: as a leading enterprise in the domestic cooling tower, the company actively develops overseas markets, has significant advantages in technology and channels, benefits from the demand for electricity and calculus, and its performance is expected to grow rapidly. We estimate that the company's revenue from 2023 to 2025 will be 1.745 billion yuan, 2.336 billion yuan and 3.023 billion yuan respectively, with revenue growth of 28.90%, 33.82% and 29.41% respectively, and net profit of 107 million yuan, 160 million yuan and 242 million yuan respectively. The growth rate of net profit reached 45.23%, 49.31% and 51.29%, respectively. Cover for the first time, give "overweight" investment rating.
Risk hint: overseas sales revenue accounts for a relatively high risk, downstream demand is lower than expected risk, industry competition aggravates risk