The company continues to release new products such as quantum dot films, composite films, and solar backsheet films, and its performance has entered a period of rapid growth. We maintain the EPS forecast for the 2020-2022 EPS at 0.80/1.42/2.00 yuan/share, maintaining the “buy” rating.
Net profit of the mother in Q1 2021 is expected to increase 70%-90% year-on-year. The company released a performance forecast. It is expected to achieve net profit of 305,0193 million yuan - 34.1098 million yuan in the first quarter of 2021, an increase of 70%-90% over the previous year and a decrease of 25.09%-32.98% over the previous quarter. Overall sales revenue increased by about 45% year on year, amortized equity incentive expenses of about 8.3 million yuan, and the estimated impact of non-recurring profit and loss on the company's net profit was about 2.7 million yuan. The increase in the company's overall operating performance in the first quarter was mainly due to an increase in orders for solar backpanel products, composite film products and quantum dot film products.
The photovoltaic backplate film performed well, and the comprehensive layout created a functional film platform. The rapid mass production and sales of new products reflect the company's leading technical technology, advanced production management level and strong downstream market expansion capabilities. While maintaining its leading position in the optical film industry, the company entered the photovoltaic backplate film field with high growth potential in 2017 and established the PV Division. At present, photovoltaic backsheet film products have been successfully mass-produced and sold, TPO and other backboard products have achieved rapid growth, large-scale mass production of products such as backplates and reflective strips for double-sided batteries has been achieved, and delivery to many leading companies in the module industry has been achieved. In addition, the company has also invested in fields such as LCP materials, OLED materials, PET-based films, and silicon-based OLED micro display technology. The company will continue to actively expand the development and market development of new products and deepen the industrial chain. In subsequent development, the company will expand new products horizontally and build a functional film platform based on core coating technology.
Seize opportunities to replace domestic production of upstream display materials, and quickly release quantum dot films and composite films. As an early domestic enterprise engaged in R&D, production and sales of optical films for displays, the company has broken through technical barriers earlier through independent R&D, equipment transformation and process innovation, and achieved mass production of diffusion films and brightening films. It is also one of the few domestic companies that have achieved stable mass production and supply of quantum dot films and composite optical films. Product quality is at the leading international level. The company's quantum dot film has been successfully verified by many companies such as Guanjie, BOE, TCL, Hisense, Microwhale, PPTV, SONY, Lenovo, etc., and some customers have begun stable mass production and delivery.
The company attaches great importance to the research and development and updating of high-end optical films such as composite films and quantum dot films, and actively cooperates with downstream customers in the development, application promotion and mass production delivery of new optical films under new display technologies such as mini-LEDs.
Risk factors: Downstream demand shrinks; market competition intensifies; new business expansion falls short of expectations; fluctuations in raw material prices.
Investment advice: The company continues to release new products such as quantum dot films, composite films, and solar backsheet films, and its performance has entered a period of rapid growth. We maintain the EPS forecast for the 2020-2022 EPS at 0.80/1.42/2.00 yuan/share, maintaining the “buy” rating.