\u3000\u3000 Wuxi Paike New Materials Technology Co.Ltd(605123) (605123)
Event: the company issued the announcement of pre increase of performance in 2021, and the annual net profit attributable to the parent company is expected to be 300 million yuan, about + 80% year-on-year; It is estimated that the net profit attributable to the parent company after deducting non-profit is RMB 282 million, with a year-on-year increase of about + 88%, realizing a higher than expected growth. The company's performance achieved higher than expected growth, mainly benefiting from the better prosperity of aviation, aerospace and new energy industries, sufficient market orders, effective improvement of production capacity, rapid expansion of business scale and improvement of operating revenue.
Multidirectional financial indicators are improving, the industry's high outlook is fulfilled, and the performance is expected to continue to release
A number of indicators to better honor the industry's high outlook. On the cost profit side, in the first three quarters of 2021, the company's three expenses accounted for 5.59% of revenue, 0.07 percentage point lower than that of 21h1, and the improvement of quality and efficiency on the operation side continued to be realized. In the first three quarters of 2021, the R & D investment reached 55 million yuan, a year-on-year increase of + 88.34%. We believe that the company continues to increase R & D investment, which is conducive to improving the company's process level and product quality, and the gross profit margin is expected to be further improved. On the balance sheet side, at the end of the third quarter of 2021, the company's inventory reached 436 million, an increase of 30.55% over 21h1; Notes and accounts receivable reached 912 million yuan, an increase of 15.19% over 21h1, both reaching a record high. We believe that the substantial growth of the company's inventory, notes receivable and accounts shows that the demand for the company's main products continues to increase, the company is in a state of active production and goods preparation, and the company's production scheduling expectation continues to increase.
The aeroengine industry has entered a high business cycle, and the outsourcing proportion of main engine plants has increased. The company is expected to achieve sustained and rapid growth in the "14th five year plan" direction: new military materials are the basic support for the leapfrog development of our military equipment, the leapfrog development of weapons and equipment has entered a period of disruptive technological breakthrough, and the breakthrough of key core technologies will be accelerated. The 22nd Politburo meeting pointed out the key contents of the 14th five year plan for the construction of our army: strive to realize the great leap forward development of our army's modernization, accelerate the breakthrough of key core technologies, and accelerate the development of strategic, cutting-edge and subversive technologies. We believe that the new generation of aviation equipment, precision strike weapons, unmanned equipment and its middle-level support - informatization, bottom support - new materials will be the main benefit areas, or will usher in a high boom stage in the 14th five year plan, and new military materials are expected to play a bottom-level basic support role in all kinds of equipment in the 14th five year plan. The company has been deeply engaged in military industry for many years and has obvious first mover advantage. Technically, the company has mastered many core technologies, such as the overall precision rolling technology of special-shaped section rings and the rolling technology of super large diameter rings. In terms of customers, the company's products cover many types of aeroengines in service and in research stage. Now it has entered the supply chain system of China Aviation Development Group, aviation industry group and their subordinate units, and has passed the supply chain system certification of international high-end equipment manufacturers such as British RORO, which has a certain first mover advantage. We believe that with the continuous increase of leapfrog weapons and equipment such as fighter aircraft, the market demand of aeroengine will increase rapidly. At the same time, considering that the military civilian integration has entered the deep-water area, the requirements for establishing a "small core, large cooperation, specialization and open" scientific research and production system of weapons and equipment will be gradually implemented, and the outsourcing proportion of each host unit is expected to continue to increase, It is expected that the company's production scheduling is expected to continue to improve.
Profit forecast and rating: To sum up, we believe that as the core supplier of chain forgings in China's aviation industry, the company is expected to benefit from the increasing demand trend of the aviation engine industry in the 14th five year plan. At the same time, considering the increase of the outsourcing proportion of the main engine plant under the guidance of the policy, it is expected that the company's performance will be released rapidly. Under this assumption, superimposed with the implementation of high-tech enterprise certification, we will increase the company's predicted operating revenue from RMB 1511, 1968 and 2557 million to RMB 1586, 2206 and 2877 million in 2021-23, corresponding to the net profit attributable to the parent company of RMB 298, 423 and 574 million, corresponding to PE of 44.61, 31.39 and 23.13x, maintaining the "buy" rating.
Risk tips: risks with high customer concentration; The risk of declining market competitiveness; The performance forecast is only the preliminary accounting results. Please refer to the annual report.
