台海核电(002366)深度分析:大堆推进 小堆兴起 军工起航

In-depth Analysis of Nuclear Power in the Taiwan Strait (002366): the rise of military industry in large piles and small piles

安信證券 ·  05/11/2018  · Researches

Repositioning: the leading company of "material development + metal forming", not only nuclear power equipment manufacturers. Different from the general view in the market that Taiwan Strait Nuclear Power is only a nuclear power equipment manufacturer, we believe that it has the core advantage of advanced "material development + metal forming" process and technology system. It will gradually expand the market space in military industry, aerospace, marine equipment, energy, petrochemical and other fields.

Big pile: AP1000's first third-generation nuclear power plant in the world has been completed, and the construction of the third-generation unit is expected to accelerate; the French nuclear power plant has entered a life extension period, which may bring new performance growth points. On April 29, 2018, the first loading of AP1000's first three-door nuclear power unit 1 was successfully completed, taking a key step towards grid connection.

From 2016 to 2017, the first pile of the third generation unit was not connected to the grid, which led to the "zero approval" of the nuclear power unit. The completion of the first pile of charging is expected to speed up the follow-up approval of nuclear power units.

At present, the capacity 56GW of nuclear power units under construction in China is only 64% of the planned target in 2020, from which it can be estimated that the domestic nuclear power equipment manufacturing market will average more than 48 billion yuan annually in the next three years. Taiwan Strait Nuclear Power is the only leading nuclear power equipment enterprise in the world with the full process production capacity of the second-generation improved nuclear power plant and the third-generation nuclear power plant, with a market share of more than 60% of the main pipeline business, which will fully benefit from the resumption of nuclear power. In addition, the company may benefit from the life extension business of French nuclear power plants.

In addition, the Taiwan Strait system is expected to achieve domestic monopoly in the field of main equipment for waste disposal of nuclear power plants.

Xiaodui: the wave of research and development has sprung up all over the world, and it is expected to enter a period of rapid development in the next 10 years. Compared with large nuclear power plants, small reactors have three major characteristics: high safety, modular design and wide range of applications. At present, with the upsurge of small reactor development in the world, the Russian Academician Lomonosov, the first floating reactor power station in the world, went to sea for the first time on April 28, 2018 and will be put into use in 2019. According to Rolls-Royce 's forecast, the global market space for small piles will be $528 billion by 2035.

In February 2018, China Nuclear Power, Taiwan Strait Group and Yantai Lantian (wholly owned by Yantai State-owned assets Supervision and Administration Commission) plan to jointly fund the establishment of China Nuclear and Taiwan Strait Clean Energy (Shandong) Co., Ltd., and launch the first comprehensive offshore clean energy supply platform in China. The agreement helps Yantai to build a 100 billion-level industrial cluster of nuclear power equipment. China leads the world in small reactor technology and development process, and the Taiwan Strait nuclear power fund-raising and development of small reactor technology will gain market first advantage and benefit from China's small reactor market space of nearly 200 billion yuan.

Military industry: the construction of nuclear-powered ships is imperative. At present, there are only 9 nuclear submarines in China, all of which are second-generation nuclear submarines, while the United States has 71 nuclear submarines, which has a large gap compared with the United States. The nuclear power and military industry in the Taiwan Strait is fully qualified and is expected to benefit from the development of naval nuclear-powered ships.

Profit forecast and investment advice: in 2017, the company achieved a revenue of 2.47 billion yuan (YoY+104.1%) and a net profit of 1.014 billion yuan (YoY+158.45%), fulfilling the performance commitment of backdoor listing. 2018Q1, the company achieved revenue of 465 million yuan (YoY+7.61%); return to the mother net profit of 184 million yuan (YoY+13.67%). We estimate that the company's net profit from 2018 to 2020 will be 11.14,14.29 and 1.743 billion yuan respectively, with a year-on-year growth rate of 9.9%, 28.3% and 21.9% respectively. The PE of the previous share price is 24X, 19x and 16x respectively, with a "buy-B" rating.

Risk hint: small reactor approval / construction progress is not as expected; worldwide nuclear power plant accidents; third-generation nuclear power unit approval progress is not as expected.

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