\u3000\u3000 Guizhou Aviation Technical Development Co.Ltd(688239) (688239)
Core view
Event: Guizhou Aviation Technical Development Co.Ltd(688239) released the performance forecast for 2021. It is estimated that the net profit attributable to the shareholders of the listed company is 137 million yuan, a year-on-year increase of + 88.47%; The deducted non net profit attributable to shareholders of listed companies was 122 million yuan, a year-on-year increase of + 73.49%. The market and customer demand in the downstream aviation, aerospace, gas turbine and energy equipment fields have increased, and the operating revenue is expected to increase by about 40% compared with the previous year. The large-scale effect helps the company further reduce costs and increase efficiency.
The key ring forging supplier of Hangfa has a broad market demand for military + Commercial aeroengines: the company's main products are aeroengine ring forgings. In the first half of 2021, the aviation business achieved a revenue of 290 million yuan, a year-on-year increase of + 34.4%, accounting for 73.9% of the total revenue. The company participated in the synchronous research and development of aeroengine complete sets in the main engine factory subordinate to AVIC, and participated in the research and development of a new generation of military aeroengines and Changjiang series commercial aeroengines. Development strategy: the air force will accelerate the replacement of Chinese military aircraft, increase the proportion of superposition and localization, and usher in a period of rapid development in the military aircraft launch market; With the development of domestic large aircraft and supporting domestic aeroengines, large-scale delivery in the future will release huge market space.
The customer base covers mainstream international aero-engine manufacturers and "two wings fly together" at home and abroad: the company has become one of the world's mainstream aero-engine manufacturers and one of the major ring forging suppliers in the Asia Pacific region. It has signed long-term agreements with Ge, Pratt Whitney, Safran, Luoluo, Honeywell and MTU, involving multiple mainstream aero-engine models. Under the influence of the epidemic, orders for overseas businesses were delayed. In 2020, the overseas business revenue was 130 million yuan, a decrease of 43.9% compared with 2019. In the first half of 2021, the company successfully participated in the product bidding of an engine model of Safran, and signed a long-term agreement with Pratt Whitney, GE and RORO on the successful winning model of the previous year. With the mitigation of the impact of the epidemic, the company's overseas orders are expected to resume, and "two wings fly together" jointly drive performance growth.
Steady growth of performance and continuous improvement of profitability: in recent years, the company's revenue has continued to grow, the scale effect has appeared, and the profitability has been continuously improved. From 2017 to 2020, the revenue CAGR reached 31.3%, and the revenue is expected to increase by about 40% in 2021; In the first three quarters of 2021, the gross profit margin reached 32.6% and the net profit margin reached 14.5%, 3.8 and 3.6 percentage points higher than that in 2020 respectively. At present, the company's capacity utilization is at a high level. With the further promotion of the construction of raised investment projects, the capacity will be effectively improved to effectively respond to the strong demand of downstream and support the company's performance growth.
Investment suggestion: it is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 138 / 203 / 289 million yuan respectively, and the corresponding PE of the current stock price is 61 / 41 / 29 times. The company is the core supplier of ring forgings of China Aviation Development Corporation, benefiting from the large-scale demand of downstream aviation development and the continuous improvement of profitability under the effect of scale. Domestic and overseas companies will be strongly supported by the release of domestic and military production capacity + commercial supply. For the first time, give a "overweight" rating.
Risk warning: the risk that the R & D batch production of new models is less than expected; Risk of price fluctuation of raw materials; The risk of the epidemic affecting the company's overseas sales.
