\u3000\u3000 Guizhou Aviation Technical Development Co.Ltd(688239) (688239)
Events
Recently, the company issued a performance forecast for 2021, deducting non net profit of 122 million yuan, a year-on-year increase of 73.49%, and the revenue is expected to increase by about 40% year-on-year.
Brief comment
Specializing in aviation ring forgings, military / civil + China / foreign multi line force
The company is one of the main research and development units of aeroengine ring forgings in China. It undertakes many major scientific research projects. It is the first batch of specialized and new “little giant” enterprises of the Ministry of industry and information technology. In China’s aviation market, the company has established a long-term and stable cooperative relationship with the main engine manufacturers and scientific research institutes subordinate to AVIC, and participated in the synchronous development of ring forgings of many pre researched and under researched types of aeroengines in China, including a new generation of military aeroengines and domestic commercial aeroengines of Changjiang series. In the international aviation market, the company has obtained the supplier qualification of major international aviation engine customers such as GE aviation, Pratt Whitney, Safran, Luo Luo, Honeywell, MTU and Collins airlines, and signed a long-term supply agreement for the supply of ring forgings for the new generation engines of the current international mainstream narrow body and wide body passenger aircraft.
The revenue and gross profit margin increased steadily, and the aviation development field dominated
The company’s 2021q3 revenue grew by 39.05%, reflecting the revenue growth brought by the high prosperity of China’s aviation industry. With the acceleration of the finalization and mass production of scientific research models, the impact of the epidemic on the international aviation manufacturing industry is gradually dissipated, and the income of the company’s ring forgings is expected to further increase. In terms of the share of forging in all fields of the company, the aviation sector accounts for more than half, accounting for more than 75% from 2019 to 2020, indicating the company’s great advantages in subdivided fields. At the same time, benefiting from the dilution of unit fixed costs caused by the rapid start-up of ring forging business, the gross profit margin of the company increased rapidly, with a gross profit margin of 32.62% and a net profit margin of 14.48% in 2021q3.
The construction of intelligent production line is expected to achieve large-scale, cost reduction and efficiency increase
The company’s IPO raised project “construction project of precision manufacturing industrial park for special alloy ring rolled forgings for aeroengines and gas turbines” is expected to be completed this year, which will expand the company’s core product capacity, build a digital smart factory for aviation forging, and shorten the design and R & D cycle; Introduce automatic advanced production equipment to improve production efficiency and product quality; Product process control based on collaborative manufacturing platform to improve product production efficiency and product quality. The construction of intelligent production line is expected to achieve large-scale business, cost reduction and efficiency increase.
Hangfa mainly engaged in ring forging business, with active layout of aerospace gas turbine energy equipment
The company is a high-tech enterprise mainly engaged in the R & D, production and sales of ring forgings of aviation difficult to deform metal materials. Its main products are aeroengine ring forgings. In addition, the company’s products are also used in aerospace rocket engines, missiles, shipborne gas turbines, industrial gas turbines, nuclear power equipment and other high-end equipment fields. The company’s aviation forgings are mainly aviation engine forgings, and also provide aviation forgings for APU, aircraft nacelle, aircraft landing gear and other aircraft components. The company’s aero-engine forgings are applied to a variety of domestic aero-engines in China, including domestic commercial aero-engines of Changjiang series; It is also used for many new generation commercial aeroengines developed and produced by international aeroengine manufacturers such as GE aviation, P & W, Safran, RR and MTU. Aerospace Forgings of the company are mainly used in launch vehicle engines and missile systems, including various cylindrical shells used to connect various parts of aerospace equipment. The company’s gas turbine forging products are mainly used in destroyers, frigates and other shipborne gas turbines and industrial gas turbines, including domestic advanced shipborne gas turbines, domestic heavy-duty gas turbines and international advanced industrial gas turbines. The company’s energy equipment forgings mainly include various bearing forgings of wind power equipment, various valve bodies, cylinders and flanges of nuclear power equipment, and titanium rings / cathode rollers of electrolytic copper foil equipment, the basic material for the production of lithium-ion batteries. In addition to the products in the above fields, a small amount of forging products of the company are used in military equipment, high-speed railway equipment, chemical equipment, engineering machinery and other fields.
The advantages of near net shape forming technology for aviation difficult to deform materials and large complex special-shaped rings are significant
The company focuses on the application technology innovation and research and development of aviation accident deformed metal materials such as superalloy, titanium alloy and aluminum alloy, and successfully realizes the stable rolling and forming of mainstream aviation materials such as GH4169, gh4141 and 718Plus. It is an important cornerstone for the company to participate in the synchronous research and development of key aircraft engine models in China, and it is also the basis for the company to fully participate in the competition in overseas markets. The integral near net shape technology of some large complex special-shaped rings of the company has reached the international advanced level of its kind: the company is one of the enterprises that produce high-pressure turbine casing forgings for the new generation of narrow body airliner aircraft engine leap, and is also one of the enterprises authorized to manufacture leap engine fan casing forgings.
Profit forecast and investment suggestions: the supporting models of aviation development are in large volume, the recovery of international subcontracting business is superimposed with the release of new production capacity, and the purchase rating is given
The company is the first batch of “little giant” enterprises specialized in special new products of the Ministry of industry and information technology. It is widely equipped with new research models and batch production models of aviation development. The volume can be expected. The recovery of international aviation foreign trade business is imminent, and the scale elasticity release and new intelligent manufacturing production lines are expected to further improve the profitability. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 122 million yuan, 192 million yuan and 281 million yuan respectively, with a year-on-year increase of 73.49%, 53.37% and 46.35% respectively. The corresponding EPS from 2021 to 2023 will be 0.87, 1.37 and 2.01 yuan respectively, corresponding to 67, 43 and 29 times of the current share price PE respectively. It will be covered for the first time and given a “buy” rating.
Risk tips
1. Risk of price fluctuation of raw materials; 2. The demand for supporting military aircraft decreases or the finalization is delayed; 3. Slow recovery of international subcontracting demand
