Events:
The company released the 2020 annual report: the company achieved operating income of 1.409 billion yuan in 2020, an increase of 40.67% over the same period last year; net profit of 167 million yuan, up 79.14%; net profit of 112 million yuan, up 45.56% over the same period last year; and basic earnings per share of 1.61 yuan, an increase of 78.89% over the same period last year. 20Q4 achieved revenue of 449 million yuan, an increase of 42.63% over the same period last year, and net profit of 37 million yuan, an increase of 129.35% over the same period last year. Performance is in line with market expectations.
Investment Summary:
The performance of traditional oil pump products is robust, the core technology is leading, and the competitive advantage is obvious. The company's traditional core products diesel engine oil pump, gasoline engine oil pump, cooling pump performance is robust, of which diesel engine oil pump domestic market share of 47.97%, sales and market share continue to maintain a steady growth. The company has mastered the relevant core technology in the frontier areas of the industry, such as engine cooling and lubrication module, variable displacement pump, medium and large horsepower pump, and maintained its technological leading edge. In March 21, the company won the certificate of "Manufacturing individual Champion demonstration Enterprise" issued by the Ministry of Industry and Information Technology and other departments, demonstrating the industry status and core competitive advantages of its products. The customer structure of the company's traditional pump products is stable, it has covered domestic mainstream mainframe factories such as Yuchai, Weichai, Dongfeng Cummins, FAW Xichai, SAIC, Geely, Great Wall and international well-known enterprises such as Cummins, Caterpillar Inc, Ford, Toyota, Daimler, Volkswagen, John Deere and so on.
Transmission pump products to achieve a breakthrough, supporting mainstream car companies, rapid growth. In the past 20 years, the company's gearbox pump business revenue reached 73 million yuan, an increase of 147.65% over the same period last year, and sales increased by 125.54% over the same period last year. At the same time, the gross profit level of 21.06% was maintained, and the proportion of revenue increased to 5.15%. Technically, the company has mastered the batch production capacity of many kinds of gearbox oil pumps, such as rotor type and external meshing gear type, supporting DCT, AT, CVT and other transmissions. Customers have covered Toyota (new energy), Aixin, Volvo, Changan Qingshan, Dongan Mitsubishi, BYD, SAIC transmission, Wanliyang, Shengrui Transmission and other well-known customers at home and abroad. and for Sany heavy Industry (Souter Transmission) exclusive development and supporting transmission oil pump, achieved significant progress in the field of construction machinery.
Product layout into the field of electric, new energy, forward-looking layout of intelligent driving executive layer. Aiming at the industry trend, the company has developed the thermal management system electronic water pump (EWP) and electronic oil pump, which can be used in pure electric, hybrid and hydrogen fuel cell vehicles, and has been equipped with Toyota (new energy), Cummins, Ericsson, Nissan, BYD and other domestic and foreign car companies; the company has developed 18W-1500W brushless DC motor for internal and external supply. Dongjia Intelligent, a subsidiary of the company, has realized the large-scale mass production of control unit (ECU) products in the electric power steering system EPS and electronic pump products, and the control unit (ECU) products equipped with its intelligent driving fully redundant steering system have been applied in unmanned airport ferries and smart city street scenes, the forward-looking layout of the company in the intelligent driving executive layer is expected to open up a new growth space for the company.
The profitability is stable, and the three fees have fallen steadily. The company's sales gross profit margin is 27.77% (- 1.88pct) and net profit margin is 11.97% (+ 2.68pct), which is basically stable. The company's three fees are generally stable, in which sales and management rates are reduced by 1.26pct and 1PCT respectively, while financial expenses are increased by 0.7pct due to interest expenses and exchange gains and losses.
In addition, the company's R & D fees have been slightly reduced by 0.18pct, but still maintain a high level of 6.54%, strongly supporting the company's forward-looking leading position in technology.
Investment advice:
We estimate that the operating income of the company from 2021 to 2023 is 1.784 billion yuan, 2.191 billion yuan and 2.668 billion yuan respectively, and the net profit attributable to the shareholders of the listed company is 227 million yuan, 277 million yuan and 320 million yuan respectively, and the earnings per share are 1.98,2.40 yuan and 2.78 yuan respectively, and the corresponding PE are 18.6X, 15.3X and 13.24X respectively. Maintain a "buy" rating.
Risk Tips:
Car sales are lower than expected, the progress of customer expansion is not as expected, the cost of raw materials is rising, and the risk of intensified competition in the industry.