The company is the leader in the subdivision field of clean electrical hoses. Mainly engaged in clean electrical hoses and accessories product research and development, production and sales, the company has formed a perfect service system. The performance of the company has been stable in the past five years. The COVID-19 epidemic broke out in the first half of 2020, the home scene increased significantly, and the demand for home cleaning products increased significantly. The company has benefited significantly as an upstream enterprise of household cleaning products. With the development of consumers' living habits and the pursuit of a higher quality of life, the company's performance is expected to maintain a high level of growth.
The permeability of domestic vacuum cleaners is low, and the potential improvement space is huge. In 2018, the penetration rate of household vacuum cleaners in China was only 16%, which is far lower than that of the United States, Japan and other developed countries.
China is a big producer of vacuum cleaners, and household vacuum cleaner exports accounted for more than 90% of the total output in 2018. However, with the acceleration of urbanization, the continuous improvement of residents' income level and the change of young people's concept of life, the domestic market demand for clean electrical appliances has shown a growing trend, and it is expected to replace the traditional cleaning tools in the future. it has gradually become a necessity for household cleaning consumption.
Cut into the supply chain of well-known brands at home and abroad, the competitive advantage is prominent. The company has strong technological innovation capabilities, raw material development capabilities and special equipment development capabilities, has accumulated rich customer resources and partners, customers almost cover most of the well-known brands at home and abroad. In 2020, the company's output and sales of vacuum cleaner hoses were 87360.83.5 million respectively. According to our estimates, the company's global market share of vacuum cleaner hoses is about 38% Mel 42%. The competitive advantage is obvious. The company's overall capacity utilization rate is more than 90%, and orders are full. Jinhua, Vietnam and other projects will further expand production capacity to meet customer demand.
The whole machine business is ready to start, and the future performance is expected to be released quickly. In December 2020, the company acquired Vietnam SUNTONE and Jiangsu Haili Electric Appliances to cut into the whole machine business. We believe that the company's whole machine business will help to build an "integrated industrial chain" from spare parts production to whole machine assembly, with the coordinated development of spare parts business and whole machine business, and further expand the profit space. After the completion of the introduction of 2021H1 customers, the whole machine business is expected to become a new performance growth point of the company.
Profit forecast: we predict that the company's operating income from 2021 to 2023 will be 1.373 billion yuan, 1.963 billion yuan and 2.52 billion yuan respectively, and the net profit attributed to the owner of the parent company will be 213 million yuan, 284 million yuan and 360 million yuan respectively. On April 29, the closing price corresponding to PE was 12.6,9.5 and 7.5 times, respectively. The company's hose business and accessories business go hand in hand, and the whole machine business will also contribute to the increment in the future, so in the long run, the company's business model will gradually tend to the domestic small household appliance enterprise parts OEM + whole machine model, and the industry can be compared to the company's average PE of 29.1 times in 2021. For the first time, coverage gives a "recommended" rating.
Risk tips: the risk of raw material price fluctuations, the risk of alternative products, the risk of customer concentration, and so on.
