Summary of viewpoints:
The company's transmission cable, optical fiber cable and equipment cable three main business plates are clear.
The domestic transmission cable pioneer, the plate benefits from the acceleration of domestic power grid investment and grid export. The company has developed the first energy-saving wire in China, which is the forerunner of energy-saving high-voltage transmission in China. In the past two years, the average investment in the construction of transmission lines of the State Grid has increased by more than 20%. With the increasing variety of power cables in our country, the technology is becoming more and more perfect, the price advantage is becoming more and more obvious, and the export demand is increasing. The rapid growth of cable market at home and abroad will be good for the company's transmission cable sector.
The demand of optical fiber cable plate has warmed up, and power optical cable and communication optical cable go hand in hand. China's power optical cable has been made in an all-round way. With the popularization of optical fiber to the home and the further integration of transmission lines and communication lines, the power optical cable market will maintain an upward trend. At the same time, the company acquired Tongguang Information, entered the public network communication fiber optic cable, and became the direct supplier of the three major communication operators, providing a guarantee for future performance.
Equipped with dual-use cables for both military and civilian use, increasing double insurance. The National Defense Industry Group of the Department of Aeronautics and Astronautics is a stable customer and demand side of Tonghua Cable Company's equipment cable products. with the increase of national investment in aerospace and other national defense equipment, especially the batch installation of new military aircraft, missiles and other equipment in the next two years, the performance of the company's military equipment cable sector is expected to maintain sustained and rapid growth. There is a huge market for civil aircraft. with China's independently developed civil aircraft gradually put into production, domestic special cable enterprises are expected to occupy a larger market share.
In the past two years, many attempts have been made in epitaxial mergers and acquisitions, and the subsequent injection of assets is expected. In the past two years, the company has attempted three mergers and acquisitions and successfully acquired a 100% stake in Tongguang Information. Although Jinbo Technology and Tongguang Ocean Optoelectronics Technology have not been successfully merged into listed companies, they are all members of Tongguang Group, and they are expected to continue to be injected into the future.
Without taking into account the late group asset injection, we predict that the company's eps in 2017-2019 will be 0.48 per share and 0.65 per share, respectively, and the corresponding PE will be times that of 30-22-16.
Risk tips: power grid construction is lower than expected due to the impact of power demand; communication cable orders are more concentrated; military R & D, procurement uncertainty.