The company is a leading wind turbine blade and container coating company. Since its establishment, the company has been in the container coating business. It began to independently develop wind power blade coating products in 2009, and entered the field of wind power blade coatings on the market in 2010. After more than 20 years of deep cultivation in the industry, the company has become a leading domestic paint supplier in the field of wind power blades and containers. Our customers cover leading downstream manufacturers, and it is a specialized and innovative “little giant” enterprise.

The rising boom in the wind power and container industry has led to an increase in the company's revenue and profit scale. In recent years, the company's paint product business scale has fluctuated and expanded, mainly benefiting from two factors. First, the rapid development of the domestic wind power industry and the boom in the global container industry rose to a historically high level after the epidemic, driving a significant increase in demand for upstream raw material coating products; second, the company is deeply involved in environmentally friendly high-performance coatings, which have a first-mover advantage in the field of environmental protection, in line with the policy requirements of the development of the coating industry. Together, the two have brought the market share of the company's segmented paint products from new market entrants to a leading position in the industry.

The total number of wind power installations worldwide continues to grow, and the company ranks first in the domestic market share of wind power coatings. China is the country with the highest total installed wind power in the world, and global wind power installations are expected to continue to increase in the future. Under the global consensus of “carbon peak and carbon neutrality,” according to GWEC forecasts, the world is expected to increase the installed capacity of 680 GW of wind power in 2023-2027. The company's wind power blade products have covered leading wind power blade manufacturers and terminal wind power machine manufacturers. In recent years, the company has been the industry leader in wind turbine blade coatings, and its leading position in the market has been continuously consolidated. As new products such as high-performance leading edge protection materials for offshore wind power are introduced to the market, the company's advantages in the field of offshore blade coatings will also be further consolidated.

Demand for container coatings is expected to recover in 2024, and the company is the leading supplier. Container manufacturing is highly cyclical, and China's container production accounts for more than 90% of the world. Global container production will be low in 2023, and container production is expected to increase in the next two years compared to 2023. The company is one of the four largest container paint suppliers in China. In 2021-2022, the company's market share increased from 13.0% in 2020 to 19.31%, or about 20%, respectively. The quality of the company's water-based container coating products has been recognized by the market and has a high-quality customer base; the products cover the top 6 container manufacturers, and the terminal products are used in 8 of the world's top ten container shipping companies and 7 of the world's top ten container leasing companies. In addition, the company is actively expanding the application of industrial coatings in other fields to provide new performance growth poles. In the field of bridge and steel structure coatings, the company has now entered the supplier lists of some engineering construction companies and steel structure manufacturing companies, and is expected to gradually expand in the future.

The “1+3+N” strategy promotes the long-term development of the company. The company has established a “1+3+N” development strategic goal, which includes three major paint application business segments: new energy sector, ocean transportation sector, and large infrastructure sector. Under the premise of adhering to the high-end positioning, the company is continuously expanding new application fields.

Profit forecasting and valuation: Combined with the company's competitive position in the main business market and continuous exploration of new application fields such as wind power tower coatings, marine coatings, and energy storage equipment coatings, the company's performance is expected to maintain steady growth. Net profit attributable to mother was 2.5/3.1 billion yuan, respectively. Based on the current total share capital of 108 million shares, the corresponding EPS was 2.30/2.92/3.64 yuan/share, respectively, giving the company 20 times PE in 2024, and the corresponding target price was 45.9 yuan/share. The first coverage gave it a “buy” investment rating.

Risk warning: Macroeconomics falling short of expectations dragging down business performance, risk of R&D progress falling short of expectations, risk of environmental protection not meeting regulatory standards, risk of price fluctuations of major raw materials, and stock price fluctuations and estimates are subjective.