The company is a diesel engine post-processing coating, electronic control, integration supplier, management team technical background, the company's business has grown rapidly in the past 5 years. Akolan mainly sells SCR, DPF, TWC and other products, the technical background of the management team, the chairman of the returnee business, mastering the four core technologies of the post-processing system (catalyst coating, electronic control, matching and calibration and system integration). The company's 2020 income / return net profit is 680 million yuan, and the CAGR in the past five years is 34%. This is mainly due to the substantial increase in the market share of SCR in light diesel trucks, and the continuous expansion of its main business from light trucks to medium and heavy trucks, from diesel engines to gasoline engines, and from cars to off-road mobile machinery.
In the next three years, emissions upgrading will bring substantial expansion to the industry, and the company's post-processing business will usher in an opportunity period. The upgrading of diesel vehicles and off-road machinery emissions will lead to a significant expansion of the reprocessing industry. From the point of view of the upstream and downstream of the industrial chain, it is expected that the domestic diesel engine catalyst coating (including carrier, the same below) and the packaging market space will be expanded by 3 times in 3 years and 1 times in 3 years, respectively, and the market space will achieve 22.6 billion yuan in 2023, respectively. Compared with the year-on-year growth in 2020, the compound growth rate in the three years 21-23 is about + 46% plus 29%.
From the point of view of terminal parts, the market space of SCR and DOC has been expanded by 1.6times and 4.5times in 3 years, respectively. It is estimated that the market space of SCR/DOC, the main product of Acer Blue, is 28.5 billion / 8.2 billion in 2023, and the compound growth rate in 21-23 years is + 17% and 65% respectively. As a leading manufacturer of light diesel engine coating and packaging in China, the company is expected to fully benefit from the expansion opportunities of the industry.
The demand for cost reduction of the emission upgrade mainframe plant is high, and the company's market share is expected to increase. In 2019, the company's SCR and DOC+POC products accounted for 12.29% of the market share of light diesel trucks. After the upgrading of No. 6, the price of post-processing products of heavy firewood and non-road mobile machinery has increased, and the demand for cost reduction of the mainframe factory has increased. The company is expected to gradually expand its market share by virtue of its cost advantage. The market share is expected to continue to increase in the future.
Emissions upgrade Dongfeng has begun, the company's business is expected to usher in rapid development, coverage for the first time, given a "prudent overweight" rating. The upgrading of post-treatment emissions has brought about a three-year period of rapid growth in the catalyst coating and packaging industry, and the company is expected to fully benefit from the tail gas post-treatment catalyst coating and integration business in the sixth stage of the country, and usher in a period of high-speed growth. It is estimated that the company's 21-23-year homing profit is 2.0 billion yuan respectively, covering it for the first time and giving it a "prudent overweight" rating.
Risk hints: the macroeconomic recovery is not as expected; diesel engine sales are down sharply; the company's market share is down; and corporate profitability is down.