The readings of this report are as follows:

The company is a leading plate enterprise in Beijing-Tianjin-Hebei region with advanced equipment level. The comprehensive competitiveness of the company's products has been comprehensively improved, the proportion of high-end products has increased steadily, and the new production line of electrical steel will contribute to the increment of the company.

Main points of investment:

For the first time, the company was given an "overweight" rating. The company is a large plate production enterprise in Beijing-Tianjin-Hebei region. We estimate that the EPS of the company in 2021-2023 will be 1.13max 1.29max 1.33 yuan respectively. With reference to similar companies, we will give the company a valuation of 1.49 times PB in 2021, corresponding to a share price of 8.1yuan. Coverage for the first time, giving a "overweight" rating.

Plate leading enterprises, focus on high-end products. The company is a leading plate enterprise in Beijing-Tianjin-Hebei region with complete product specifications and brands. The company focuses on the development of automotive plates, electrical steel and tinplate products, the revenue share of the three types of products has gradually increased, and the market share has expanded steadily. The comprehensive competitiveness of the company's automobile plate and electrical steel ranks in the forefront of the industry. With the development of the company's high-end products, the company's profitability will gradually rise and its competitiveness will continue to strengthen.

The price of electrical steel is higher, and the path of capacity expansion is clear. In the context of the rapid increase in the permeability of new energy vehicles, the supply of electrical steel is tight, and the price is gradually rising. The manufacture of electrical steel is difficult, the industry barriers are deep, and the company has a strong competitive advantage in electrical steel products, which will fully benefit from the rise in the price of electrical steel. The company's new energy vehicle non-oriented electrical steel production line is expected to be put into production in 2022, and the second phase of the company's oriented electrical steel project is expected to be put into production in 2023. The company's electrical steel production capacity will increase steadily, and the performance is expected to continue to release.

The depreciation peak has passed, fully benefiting from the recovery of the industry. With the relocation and structural adjustment of the company in the past ten years, the asset quality of the company has been greatly improved, and the high point of depreciation and financial expenses of the company has passed.

The iron and steel industry capacity cycle ends, the supply first background, the industry profit center will gradually rise, the company as the industry leader, will fully benefit.

Risk hint: the progress of new capacity is not as expected and car sales are down.