The rise of AMC high-end integrated services leader for the first time covered the "highly recommended" rating company, which used to be a well-known professional manufacturer of oil logging equipment in China, entered the field of non-performing asset management (AMC) at the end of 2016 and transformed into AMC high-end integrated service providers. We believe that the competition in the non-performing assets management industry is becoming increasingly fierce, the profit margin of the traditional acquisition and disposal model has been greatly narrowed, and the integrated service model based on professional capabilities such as evaluation and disposal will have more competitive advantages in the future. The company's core team has excellent professional competence, focusing on restructuring and management services, and is expected to develop into a leader in AMC high-end integrated services, with high performance. We estimate that the company's 2018-2020 return net profit is 395 million yuan, corresponding to 0.65 million yuan for EPS, and 0.93 yuan for PE, and the current share price corresponds to 19-14-10 times for 2018-2020.

Cover for the first time, giving a "highly recommended" rating.

With the fierce competition and rising costs in the AMC industry, the advantages of integrated services highlight that with the deepening of supply-side reform and deleveraging, the potential risks of the market are gradually exposed; a number of regulatory policies have been issued to urge banks to speed up the clearing efficiency of non-performing loans, the supply of non-performing assets will continue to increase in the future, and there is a huge space for the development of the AMC industry. Although the pattern of "4-4-2-N + banking system" in the industry has gradually taken shape, due to the high heat of the industry in recent years, many local AMC and unlicensed private AMC have flooded into the market, aggravating the competition in the industry to drive up the package cost, and the profit space of the traditional disposal business has been greatly compressed.

At this stage, the comprehensive disposal efficiency of non-performing assets has replaced the bag-taking ability to become an important competitiveness of the industry, so the competitive advantage of high-end integrated service companies focusing on restructuring and service business will be more prominent, and the AMC industry has entered a new stage of development.

Bind the core team to build a high-end integrated service provider, evaluate and dispose of the ability to build a competitive company to build an industry excellent team headed by Chairman Yao Qing. It has outstanding competitive advantages in the industry core competencies such as asset evaluation (relying on experience and data accumulation) and disposal (determining the rate of return). Create high-end integrated service providers for non-performing assets by integrating supporting resources in the upper and lower reaches of the whole industry chain. In the business model, the company focuses on the restructuring services and management services of light assets, with both stability and potential high returns. In terms of regional expansion, with the help of the "partner" model to quickly achieve the national layout, hand in hand with the four major AMC, the ability to take orders in the exhibition industry is further. In the future, the company will focus on the main business of AMC, and continue to spin off the declining traditional oil service business, travel light, and accelerate growth.

Risk hint: competition in the non-performing asset management industry intensifies and policy changes