Key points of investment
Next Wednesday (February 28), a GEM listed company “Meixin Technology” will ask for a quote.
Meixin Technology (301588): The company's main products are new environmentally friendly plastic wood profiles such as outdoor flooring, wall panels, and composite flooring. The products are widely used in outdoor environments such as home courtyard balconies, public building facilities, and landscape construction.
The company achieved revenue of 695 million yuan/746 million yuan/792 million yuan respectively in 2021-2023; YOY was 39.81%/7.41%/6.08%, and the three-year compound annual growth rate of operating income was 16.79%; net profit to mother was 93 million yuan/85 million yuan/76 million yuan, YOY was 43.49%/-9.33%/-10.36%, and the compound annual growth rate of net profit for the three years was 5.26%. According to the company's management's preliminary forecast, the company's revenue for January-March 2024 is estimated to be about 19.0204 million yuan to 20.69981 million yuan, a year-on-year change of 0.13% to 8.97%; the net profit for January-March 2024 is estimated to be about 17.3997 million yuan to 19.0365 million yuan, a year-on-year change of -4.11% to 4.91%.
Investment highlights: 1. The company has established a competitive advantage in the international market through self-developed fully coated plastic wood products, and has become one of the few well-known domestic brands that compete in the international market with its own brands. The company has been deeply involved in the field of outdoor plastic wood profiles for more than 20 years. Self-developed fully coated plastic wood products have better anti-scratch, anti-static, and wear-resistant characteristics than traditional uncoated plastic wood materials; the series was fully launched on the market in 2011, forming a strong competitive advantage in the outdoor plastic wood profile industry. Since the main consumer market for plastic wood is still concentrated in Europe and America, where entry barriers are high, most domestic plastic wood manufacturers are mainly ODM brands, and the founder of the company has early study and work experience in the US. Since 2011, he has actively cultivated his own brand “NewTechWood” through fully coated plastic wood products; in recent years, the brand effect has been shown, and the company's own products are exported to more than 50 countries or regions on all continents, becoming one of the few domestic plastic wood manufacturers that can directly compete with leading international industry leaders with their own brands; in 2022, the company's plastic wood composite profiles The market share of the product in the US region reached 3.63%, and the market share in the European region reached 2.38%. 2. The company continues to improve production processes and equipment, and has strong production optimization and cost control capabilities. On the one hand, the company creatively improved the production mold and used a stretch extrusion method to greatly increase the co-extrusion speed from 0.6-0.7 m/min to 1.2 m/min, greatly increasing the company's production capacity. On the other hand, the company successfully achieved automated and large-scale production through independent innovation and improved automated post-processing production technology and digital color control technology; according to the company's prospectus, the number of employees in the post-processing log line was reduced from 13-15 people per production line to 6-7 people per line, saving an average of 53.59% of labor and increasing log line production capacity by 10%-20%, greatly improving production efficiency; according to the company's 2023 financial statements, the company's gross margin was 33.24%.
3. The company actively promotes product iterative upgrading, and the newly launched aluminum-plastic co-extrusion products meet the new development trend of the industry. With its accumulated full coating technology, the company launched a new aluminum-plastic co-extruded product as early as 2021. By adding a specially modified polymer layer between the aluminum substrate and the fabric, the surface layer material is effectively combined with the aluminum substrate, thereby reliing on the aluminum alloy substrate to obtain higher load-bearing structural performance and fire resistance. It is expected to be applied in the fields of automobiles, doors and windows, furniture, integrated houses, etc., further broadening the application range of the company's plastic wood materials.
Comparison of listed companies in the same industry: Sentai Co., Ltd., Nanjing Julong, Guofeng New Materials, etc. were selected as comparable listed companies of Meixin Technology; judging from the comparable companies mentioned above, the average revenue of comparable companies from the fourth quarter of 2022 to the third quarter of 2023 was 1,532 billion yuan. The comparable PE-TTM (excluding Guofeng New Materials/Arithmetic Average due to fluctuations in net profit) was 25.04X, and the gross sales margin was 15.77%. In comparison, the company's revenue scale is below the average of comparable companies, and the gross sales margin is in the middle to high range of the same industry; however, there are differences between the company and the comparable listed companies mentioned above in terms of main business direction, product structure, etc., and comparability may be relatively limited.
Risk warning: There is still a possibility that companies that have begun the inquiry process will not be able to go public due to special reasons; company content is mainly based on the content of prospectus and other public information; there is a risk that the selection of listed companies in the same industry is not accurate enough; there may be interpretation deviations in the selection of content data. The specific risks of listed companies are shown in the text.