Matters: Tianli Environmental Protection notice on November 5, the company won the bid Wuhai Yifeng Industry and Trade Co., Ltd. annual output of 800000 tons of calcium carbide project EPC general contract, will sign a contract with Yifeng industry and trade within 2 weeks. The winning bid amount of the company is as high as 770 million yuan (the company's revenue from January to September 2012 is 387 million), which will make a great contribution to the company's performance next year and the year after next. The company's large-scale energy-saving and environmental protection submerged arc furnace technology is highly recognized in the calcium carbide industry market, and began to enter the ferroalloy field. At the same time, the company has actively tried to upgrade and transform its business model, and has made substantial progress in the areas of pulverized coal furnace heating and comprehensive utilization of mineral resources. We communicated with senior executives about the company's business situation and future development direction.
Peace viewpoint:
Sufficient orders and steady development of the main business
From the introduction of foreign technology for digestion and absorption, to provide their own products, and then gradually transition to the provision of general contract services, the company has been highly recognized in the industrial kiln transformation in the calcium carbide industry. According to the company announcement and revenue estimates from January to September this year, coupled with the newly signed 770 million Wuhai project orders, the current outstanding order size of the company is about 1.7 billion. Sufficient orders will form a strong guarantee for the smooth operation of the company's main business. The company maintains a positive attitude in its traditional business and currently has a number of projects under discussion.
Initial results in the development of new business
Affected by the low prosperity of downstream demand, the company's traditional business customers are facing greater financial pressure in the short term.
The progress is slower than expected; at the same time, as the project cycle is generally as long as 2 years (the equipment supply cycle is about 8 months), the company is also facing greater financial pressure. Therefore, while doing a good job in the main business, the company actively carries out the expansion of business scope and the upgrading and transformation of business model. At present, the company has business reserves in boiler energy-saving transformation (pulverized coal furnace central heating), comprehensive utilization of mine resources, new materials, etc., among which pulverized coal furnace heating has been implemented, and the acquired mining companies have also begun to contribute their performance.
The pursuit of transformation is worthy of recognition, and the rating of "recommendation"
Under the situation of the decline of the traditional business prosperity, the company lays out in advance, carries on the business expansion in many areas, and chooses the transformation direction of the business model according to the actual progress. Therefore, in the short term, the company's business is more scattered.
The company's active practice of business model optimization is commendable. It is expected that the EPS this year and next year will be 0.43 and 0.65 yuan respectively, covering it for the first time and giving it a "recommended" rating.
Risk tips: 1, the decline in the prosperity of the industry where the main customers are located, resulting in the delay of the construction period; 2, diversification increases management difficulties
