Main points of investment:
Major shareholders will provide interest-free loans and foreign investment will be successfully completed. To supplement the capital needed for the company's production and operation as well as the need for foreign investment, the company intends to borrow no more than RMB 850 million yuan without interest from Lanying, with a loan period of 24 months. The support of the major shareholders will help the company to complete the overseas acquisition, and the company will acquire all the equity assets and non-equity assets related to the industrial cleaning system and surface treatment business of the Duer Group, with a value of 738 million yuan. The acquisition can be carried out through the shareholders' meeting. After the completion of the transaction, the listed company will hold 85% of the underlying assets. Doyle Group is the market leader in the industrial cleaning system and surface treatment business, and leads the company towards globalization.
In the next 3 years, the company's main performance growth will be industrial cleaning equipment and services, especially in North America and China. Considering that more than 60% of Duer's cleaning business is cleaned by the automobile industry and will perform in the Chinese market after acquisition by listed companies, the main growth in the company's performance in 16-18 will come from cleaning equipment and services in the domestic automobile industry. The domestic automobile industry has achieved a net profit of 91 billion yuan in 15 years, and it is expected that the industry profit will increase by 8% and 3% respectively in 17-18 years. Assuming that the automobile raw materials and cleaning equipment / net profit are consistent with those of previous years, the industrial cleaning equipment and services account for 10%. At present, Dur Group has cooperated with many well-known automobile manufacturers and has launched business in 7 regions of the country, with a market share of about 10%. China's market share is expected to be 15% and 20% respectively in 17-18, so the company's industrial cleaning and surface treatment business is expected to achieve 1.573 billion, 1.991 billion and 2.398 billion revenue in 16-18.
The corridor project has completed the debt divestiture, maintained the profit forecast and maintained the buy rating. Listed companies have spun off corridor-related debts to controlling shareholders to improve cash flow. It is estimated that the company's 16-year net profit is 13 million yuan, the performance is at the bottom, 17-18 net profit is 164 million yuan and 230 million yuan, EPS is 0.61 yuan / 0.85 yuan, corresponding to PE is 27X/19X. Analogy with German industry 4.0 related to the machinery sector companies, the 17-year average PE is 40X, while Ecoclean is the A-share industrial service scarce target, and has global sales and industrial service experience, domestic listed companies are optimistic about their expansion in the Chinese market after acquisition, conservative estimates give the industry average valuation, that is, the 17-year PE is 40X, the corresponding market capitalization is 6.56 billion, and the corresponding stock price is 24.3 yuan There is 50% room for the current share price, maintain the earnings forecast and maintain the buy rating.
