\u3000\u3000 Avic Heavy Machinery Co.Ltd(600765) (600765)
In 2021, the net profit attributable to the parent company is + 153.05%, and the operating revenue is expected to increase by about 30% year-on-year, realizing rapid growth
The company released the performance forecast for 2021. In 2021, the operating revenue is expected to increase by about 30%, the revenue is expected to reach about 8.7 billion, and the operating revenue will achieve sustained and stable growth. The net profit attributable to the parent company is expected to be about 870 million yuan, with a year-on-year increase of about 153.05%. The net profit after deducting non recurring profits and losses is expected to be about 700 million yuan, with a year-on-year increase of 157.80%; The divestiture of the company's subsidiary Liyuan Suzhou may be the main reason for the increase of non recurring income. At the same time, we believe that the main reason why the net profit margin of Q4 sales in 2021 is lower than Q3 is the increase of seasonal expenses and the different types of phased delivery products (Q3 is withdrawn and reversed in a single quarter, there is less expense confirmation, and the quarterly net profit margin is ultra-high). Throughout the year, the company expects to achieve a net profit margin of about 10% in 2021, and its profitability will be significantly improved over the previous year (the net profit margin of 5.13% in 2020).
Profitability continues to improve, and the company's net interest rate is on a long-term upward track
The company is expected to usher in the improvement of capacity utilization brought about by the optimization of product structure (small batch and multiple varieties affect capacity allocation). At the same time, the marginal cost decreases under the scale effect after the climbing of new products (including the reduction of fixed cost allocation and the decrease of variable cost caused by manufacturing upgrading). The profitability may enter the track of continuous improvement on the basis of large-scale production. At the same time, from 2015 to 2020, due to the active stripping of loss and inefficient businesses in non main industries such as new energy and gas turbine industry, the company made an average annual provision for asset impairment of 300 million. We believe that the impairment or significant reduction of non production and operation assets withdrawn due to stripping assets in the future will also significantly improve the company's profits.
The release of new production capacity is imminent, and the expansionary demand for aircraft & aeroengine forgings drives the high growth of construction period performance
As a leading aviation forging enterprise, the company produces aircraft fuselage wing structure forgings, aero-engine disc and shaft and ring forgings, aerospace engine ring forgings and small and medium-sized forgings, or will fully benefit from the expansion trend of forging demand. In order to meet the dual drive high business cycle of military aircraft weapon equipment replacement and domestic civil aircraft development, the company raised 1.327 billion yuan and 1.91 billion yuan in 2018 and 2021 respectively for the construction of advanced forging, civil aviation ring forging, key hydraulic basic parts, high-efficiency heat exchanger, aviation precision die forging and isothermal forging production lines, In order to improve the development and production supporting capacity of the company's aviation precision die forgings, realize the industrial transformation and upgrading of the company, and meet the market demand of large precision die forgings for Chinese military aircraft, commercial aircraft and international commercial aircraft. With the completion and production of the company's raised investment projects from 2022 to 2025, the company's production capacity will be improved to further consolidate and strengthen the company's leading position in the forging industry.
Equity incentive shows the confidence of the company, and the performance growth in the next three years can be expected
The company completed the equity incentive plan in June 2020 and granted restricted shares to 115 core employees of the company at the price of 6.89 yuan / share. The unlocking conditions correspond to the compound growth rate of revenue in 2021 / 2022 / 2023 not less than 6.4% / 6.5% / 6.6%, the weighted average roe not less than 4.7% 4.9% / 5.1%, and the operating profit margin not less than 5.3% / 5.4% / 5.5%. Equity incentive can establish a long-term restraint mechanism for the company's management and effectively help the company's future net profit growth.
Profit forecast and rating: we believe that the company's core business will benefit from the upgrading of our military aviation equipment, and is expected to continue to grow rapidly in the next three years; At the same time, with the gradual landing of China's large aircraft projects, the company's civil aircraft forging and casting products are expected to achieve large-scale growth by leaps and bounds. Under this assumption, we expect that the net profit attributable to the parent company of the company in 2021-2023 will increase from 8.35/11.80/15.65 to 871/13.94/1981 million yuan, the corresponding EPS will increase from 0.79/1.12/1.49 to 0.83/1.33/1.88 yuan / share, and the corresponding P / E will be adjusted to 50.43/31.51/22.18x, maintaining the "buy" rating.
Risk tips: risks with high customer concentration; The risk of declining market competitiveness; Risks of fluctuations in military products business; The performance forecast is the preliminary calculation result, and the specific financial data shall be subject to the company's disclosure announcement.
