China Jushi (600176): slightly lower performance, market expectations, supplementary production capacity improvement, comprehensive gross profit, US base put into operation, and perfect market layout

China Jushi (600176): slightly lower performance, market expectations, supplementary production capacity improvement, comprehensive gross profit, US base put into operation, and perfect market layout

Investment highlights: The company released its 2018 annual report, and its performance was slightly lower than market expectations.

2018 achieved operating income of 100.

320,000 yuan (+15 compared with the same period last year).

96%), net profit attributable to shareholders of listed companies.

7.4 billion (+ 10% year-on-year.

43%), 青岛夜网 slightly lower than expected.

Of which 2018Q4 operating income was 24.

30,000 yuan (+8 compared with the same period last year).

63%, QOQ-7.

97%), net profit attributable to shareholders of listed companies.

6.2 billion (YOY-21.

88%, QOQ-28.

49%).

The decline in the company’s Q4 performance from the previous quarter was mainly due to the release of increased production capacity in the industry in the fourth quarter and the export war caused by the trade war. The price of the company’s products slightly shifted.

At the same time, the company withdrew 92 million yuan in asset impairment in the fourth quarter.

Glass fiber products are under pressure from volume and price, new capacity will gradually be released to open up the company’s profit space, and the production of US bases will reduce the impact of the trade 武汉夜生活网 war on the company.

Affected by the industry’s increase in production capacity and the impact of the trade war, the company’s volume and price were under pressure, but the gradual end of the industry’s increase in capacity expansion in 19 years came to an end. It is expected that the company’s gross profit margin will increase and stabilize in 19Q2.

At the same time, the four production lines that were newly built and cold repaired at Jiujiang in 2018 were all put into production as scheduled, and the largest annual output of 35 in the central region was fully completed. The construction of the intelligent manufacturing base at Tongxiang headquarters was fully advanced.The 6 plug-in production line project has been put into production in the fourth quarter of 2018; the displacement framework agreement for the relocation of the entire plant in Chengdu is planned to be relocated and the implementation of the “25-insert glass fiber kiln wire drawing production line construction project”; the international layout has been steadily advanced, and the US project8 It is expected that alkali-free glass fiber yarn will be put into production at the end of the first quarter of 2019.

With the gradual release of more production capacity and the improvement of the international layout, the company’s profitability will reach a new level, which can effectively avoid the impact of the trade war.

Layout of high-end products weakens the periodic attributes, and the integration with Sinoma Science and Technology fiberglass business will be promoted to the next level.

The company will implement a new material intelligent manufacturing base project in Tongxiang Economic Development Zone, Zhejiang Province. In the next five years, it will plan once to build three alkali-free glass fiber production lines and three electronic yarn and electronic cloth production lines in phases.

After the completion of the project, it will increase the annual production capacity of 45 inserts of alkali-free glass fiber, 18 inserts of electronic yarn and 800 million meters of electronic cloth, which can better meet customer needs. While promoting and enhancing industrial development,Economic benefits of the company.

The integration of the company’s glass fiber business with Sinoma Technology is on the agenda. At present, the total glass fiber output exceeds 240 mm, accounting for more than half of the total domestic glass fiber production capacity, accounting for more than 30% of the world’s total.Perfect, the industry’s right to speak will rise to another level, and global fiberglass giants are being born.

Investment rating and profit forecast.

Affected by the industry’s new production capacity and trade war, the volume and price of glass fiber products are under pressure. We lower the company’s net profit forecast for mother to 2019 to 2020.

89, 31.

2.5 billion (original value 33.

64, 39.

700,000 yuan), plus a predicted net profit of 35 in 2021.

54 trillion, corresponding to 0 EPS.

80/0.

89/1.

At 01 yuan, the current corresponding dynamic PE is expected to be 13X / 12X / 10X. The current overall expectation is low. The release of new capacity will be converted in the future. The company’s performance is expected to usher in a new round of growth.

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