Event: Huachen equipment signed a strategic agreement with Best on October 8, which plans to provide Best with precision CNC linear guideway grinder products and corresponding technical support of the leading international industry enterprises within one year.

The company is the leader of domestic roll grinder, and the upward inflection point of performance has appeared:

Huachen equipment was founded in 2007, is the domestic roll grinder industry leader, downstream customers cover Baowu, Shougang, Angang, India TATA and other large domestic and foreign iron and steel groups. The company's products include fully automatic CNC roll grinder, internal and external compound grinder (sub-μ grinding series products), maintenance and transformation services and spare parts products. Among them, the fully automatic CNC roll grinder is the main source of income of the company, accounting for about 80% of the income from 2018 to 2022.

The roll grinder is the key equipment to repair the precision of the roll. The roll plays the main function in the metal calender rolling process (that is, the metal is pressed into a sheet), and has high requirements for precision and surface quality, so it is necessary to use a roll grinder to repair the precision after wear. the grinding accuracy of the roll grinder will directly affect the accuracy of roll processing, and then affect the rolling efficiency and rolling quality.

There are plenty of orders on hand, and the upward inflection point of performance has already appeared. 23H1 in the domestic and foreign situation tends to be stable, the company's equipment delivery, installation and other work gradually returned to normal, achieving revenue / return net profit of 2.5 / 50 million yuan, year-on-year + 59% Universe 95%, the performance of the upward inflection point has appeared. At the same time, as of the end of 23H1, the company's contract liabilities-inventory reached 2.7 and 411 million respectively, compared with the same period last year, + 12%, + 12%, 22%, sufficient orders on hand, and guaranteed performance growth in the second half of the year.

The bottom CNC metal grinding principle is the same, the company cuts into the screw guideway grinding track has the technical advantage:

The metal grinding principle involved in roll grinder and screw guideway grinding is the same. Roll grinder and screw guideway grinding are high precision grinding equipment, which actually polish all kinds of "lines" on the surface of metal workpiece.

Compared with the screw guideway, the roller requires higher surface precision, so the corresponding requirement for the grinder is also higher. The machining accuracy of the company's roll grinder can reach 0.02 μ m, in which the curve grinding accuracy is 2 μ m / m. The existing technology is fully capable of covering the processing requirements of the screw guideway.

The technology in the field of high-speed grinding is leading, and the cutting-into-screw guideway grinding track has a strong R & D advantage. In 2003, the company began to independently develop and manufacture CNC roll grinder, a number of products achieved key core technology breakthroughs to fill the domestic gap. Since 2017, the company has cooperated with Wieland in Germany to jointly develop a high flexible and high precision CNC internal and external cylindrical compound grinder. After three years of technical research and two years of engineering grinding process testing, the company has successfully developed a domestic sub-micron universal precision compound grinding center (named sub-μ grinding center). It can realize the precision grinding of complex feature parts such as outer circle, inner circle, end face, profile, non-circle, thread and so on.

Teaming up with Best, it is expected to cut into a wider humanoid robot track:

The company provides comprehensive equipment support for the Best Rolling function project. The core equipment needed in the production process of screw guideway mainly includes three kinds: primary cylindrical grinder, core thread grinder and guideway grinder. At present, the company has successfully developed the above core equipment, of which the cylindrical grinder has been shipped. We judge that this is also an important reason for Best and Huachen equipment to sign a comprehensive strategic partnership agreement. According to the disclosure of the company, the products involved in the agreement are currently the products with the longest grinding length, the highest technical difficulty and the highest grinding efficiency in the world. strong product capabilities enable the company to provide comprehensive equipment and technical support to Best in the processing and manufacture of robots, machine tools and core automotive parts.

In the long term, the rapid expansion of humanoid robots is expected to generate a large number of screw demand, so high-precision grinders also benefit as key production equipment. At present, the main scheme for humanoid robot screw is reverse planetary roller screw, and its grinding quantity and machining difficulty are much higher than trapezoidal screw and ball screw, so high precision grinder is an indispensable processing equipment for screw link. Will fully benefit from the humanoid robot capacity. According to our estimation, the market space of planetary roller screws for humanoid robots will reach 10.3 billion yuan by 2030, and the long-term space is broad. As a domestic leader in mid-and high-end grinders, with the continuous downstream verification of new products, the company is expected to fully benefit from the expansion of equipment demand brought about by humanoid robots.

Profit forecast and investment rating: in the future, with the recovery of the downstream manufacturing sector and the further release of the capacity of the superimposed company, we expect the company's 2023-2025 net profit to be 1.12x1.41 billion yuan respectively, and the current stock price corresponding to the dynamic PE is respectively times that of 64-51-41, maintaining the "overweight" rating.

Risk tips: the manufacturing industry is not as prosperous as expected, market competition aggravates the risk, and so on.