Shanghai Electric is the leading brand of Chinese industry. The company's industry focuses on energy equipment, industrial equipment and integrated services, among which the output of thermal power equipment has ranked first in the world, and the output of a single elevator factory ranks first in the world. printing and packaging machinery, refrigeration air conditioning, CNC grinders and other products have the first domestic market share. Shanghai SASAC is the actual controller of the company and indirectly holds 59.41% through Shanghai Electric Group Corporation. At present, the company has more than 70,000 employees, and its revenue and assets reached 127.5 billion yuan and 280.5 billion yuan respectively in 2019.
Braving the wind and waves, we will take various measures to actively respond to the transformation and upgrading of the energy structure. In the field of thermal power, the company is burning coal, reducing gas and increasing fuel gas, and Xu Li energy transformation. In terms of coal-fired power generation technology, the company leads supercritical and ultra-supercritical, secondary reheat, IGCC and other energy-saving and emission reduction power generation technologies, and actively participates in the process of promoting the localization of gas turbine technology. The company has thermal power equipment projects in more than 30 countries and regions around the world, with an installed capacity of more than 9200 kilowatts.
In the field of wind power, the company is the absolute leader of offshore wind power, with a domestic market share of 40%. By mid-2020, the company's orders for hand wind power equipment totaled 57.09 billion yuan, an increase of 90.4 percent over the end of 2019, of which offshore wind power equipment orders totaled 38.94 billion yuan, up 126.9 percent. Wind power business spin-off listing + "Fengyun 2.0" intelligent operation and maintenance, the future is expected to help the company's wind power business development speed up. Under the new energy spring tide, energy storage may become a rigid demand for electric power development, the company actively layout in lithium battery, liquid flow battery, fuel cell and decommissioned battery system, and through equity mergers and acquisitions quickly open the energy storage lithium power industry chain.
The integration of wisdom and practice, the advanced road of intelligence quotient and service provider. "two new and one heavy" provides the development path for the upgrading of the manufacturing industry, and the internal circulation provides development space and kinetic energy. Elevator business is the key business of the company's intelligent manufacturing. In 2019, the output of elevators was 88200, the income was 21.013 billion yuan, and the domestic market share reached 7.5%. The company takes the transformation of old ladders and the installation of old houses as a breakthrough to create new service growth points. In the field of traditional intelligent manufacturing, the company stands at the forefront of the trend and gradually improves the layout of intelligent industrial clusters. A total of 16 subsidiaries of the company constitute the core industrial cluster of intelligent manufacturing; to provide system solutions as a business model, focusing on building automation solutions in the fields of intelligent manufacturing, intelligent transportation and smart cities; and focus on the development of industrial robots, lithium battery production equipment, aerospace equipment, 3D printing equipment, CNC machine tools and other automation products and equipment.
The company's revenue growth is stable, and the management quality has been steadily improved. Although coal-fired power generation equipment is affected by industry policies, the company's overall operation remains stable and positive growth. In 2019, the company's revenue reached 127.5 billion yuan, and in 2016-2019, ACAGR reached 17.26%. In the first three quarters of 2020, the company achieved revenue of 82.532 billion yuan, an increase of 9.72% even in the case of a serious epidemic. In recent years, the company's gross profit margin has basically remained above 20%, and the net interest rate has remained above 5.4%. During this period, the expense rate has shown a downward trend as a whole. In the past five years, the company's total assets have nearly doubled from 162.1 billion yuan to 313.1 billion yuan, and the asset-liability ratio has basically remained between 65 and 70 percent. The company's operating quality is relatively high, the main business ratio has been maintained at more than 97% in the past three years, and the company's cash / revenue ratio is more than 100%. The company's operating efficiency has gradually improved in recent years, and the turnover index has shown a steady upward trend. on the other hand, the business cycle shows a downward trend.
Investment advice: cover for the first time, give buy-An investment rating, 6-month target price 6.00 yuan. We estimate that the company's annual revenue in 2020-21-22 will reach 140.2 billion yuan, 164 billion yuan and 194.2 billion yuan, with a growth rate of 9.9%, 17.0% and 18.4%, respectively. The net profit of returning home is expected to reach 3.756 billion yuan, 4.436 billion yuan and 5.019 billion yuan, with growth rates of 7.3%, 18.1% and 13.2% respectively. EPS per share is 0.25,0.29,0.33 yuan respectively. The company is a leading enterprise in power equipment and intelligent manufacturing. At present, it is focusing on the mechanism / system reform, focusing on promoting the "four transformations" to reshape Shanghai Electric. For the first time, it is given a buy-An investment rating, with a 6-month target price of 6.00 yuan, corresponding to a 2020 valuation of 24x.
Risk tips: macroeconomic decline or exchange rate risk; risk of decline in fixed investment or increased competition in the industry; operating risks in overseas markets; rising prices of raw materials affect profitability.