\u3000\u3000 Western Metal Materials Co.Ltd(002149) (002149)
Events
The company issued the performance forecast for 2021, and it is expected to realize the net profit attributable to the parent company of about 120 million yuan to 140 million yuan in the whole year; Deduct the net profit not attributable to the parent company of about 96 million yuan – 116 million yuan; The basic earnings per share is about 0.2458 yuan / share -0.2868 yuan / share.
Brief comment
The leader in the new material industry has achieved rapid growth by deducting non net profits under the epidemic environment
In 2021, the company expects the net profit attributable to the parent company to be 120-140 million yuan, with a year-on-year increase of 51.11-76.30%, and the net profit deducted from non attributable to the parent company to be 96-116 million yuan, with a year-on-year increase of 121.25-167.34%; The basic earnings per share was 0.2458-0.2868 yuan / share, and the profitability was steadily enhanced. The real economy has been impacted under the epidemic environment, but the company continues to strengthen market development and actively expand markets in military industry, nuclear power, environmental protection and chemical industry; Vigorously promote the optimization and upgrading of product structure. The increase in the proportion of the company's aerospace titanium alloy products and other value-added products helped the profit growth, making the company's profitability grow continuously in the environment of slowing economic growth.
Against the background of the acceleration of modernization, the revenue growth space is expected to continue to improve
During the 14th Five Year Plan period, accelerating the modernization of national defense and the army and realizing the reunification of a rich country and a strong army is one of the country's long-term goals. Under the background of accelerating the upgrading of weapons and equipment and the modernization of military organizational form, the company takes the national strategy and market demand as the guidance, seizes the opportunity of military equipment upgrading and the transformation of manufacturing industry to high-end, promotes product optimization, strengthens innovative R & D, actively cultivates and develops Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) to realize the high-quality development of the company; In the first half of 2021, the company achieved a sales revenue of 1.157 billion yuan (+ 27.35%), of which the titanium sector is expected to continue to usher in rapid growth during the 14th Five Year Plan period, which will help the company's performance and become the main support for the company's future revenue growth.
The increase in the amount of related party transactions of the company indicates a high growth in the whole year
The company expects to have related party transactions with related parties in 2021, with an estimated amount of 196.8 million yuan. As of September 30, 2021, the company has had related party transactions of 129.1444 million yuan. According to the actual situation of the company's production and operation, the estimated amount of daily related party transactions in 2021 is adjusted. After adjustment, it is estimated that the company will have related party transactions with related parties of 267.2 million yuan in 2021. Related party transactions are settled at the market price, and there is no situation that damages the interests of the company and shareholders. At the same time, it can be seen that the business volume of the company increases and the orders are full; The industrial chain and supply chain are relatively stable, with rapid revenue growth and guaranteed performance.
Strengthen personnel training and adhere to innovation driven development
Under the "14th five year plan", the company actively promotes the transformation and upgrading of human resource management to provide reliable human resource guarantee for the high-quality and sustainable development of the company. At the same time, the company continues to promote the construction of "two platforms". In the construction of innovation platform, the company introduced more than 10 doctors and masters from the joint technology center in the first half of the year, and started the preparation of four laboratories; In terms of digital platform construction, complete the data interconnection between MES system and ERP system, and continue to further optimize ERP system to further improve data value. In the R & D process in the first half of the year, a total of 43 million yuan was invested, more than 40 projects such as the industrial and Information Technology Commission and the national development and Reform Commission were applied for, 20 patents were applied for and 22 patents were authorized. The company attaches importance to innovation driven development, strives to improve the layout of the whole industrial chain, actively expands new markets, and is expected to be evergreen in terms of future revenue.
Actively focus on the titanium business segment, improve the industrial chain system and seize market opportunities
The company is a leading enterprise of new materials in China, with continuous investment in R & D and innovation, and remarkable R & D achievements in new projects, new products and new technologies. With profound R & D accumulation and long market development time, the company has developed into a large-scale and comprehensive R & D and production base for deep processing of metal materials, with titanium and titanium alloy processing materials, layered metal composites, rare and precious metal materials, metal fibers and products, rare metal equipment, tungsten molybdenum materials and products Titanium products are mainly used in aerospace, nuclear power, environmental protection, marine engineering, petrochemical, chemical, metallurgical, electric power and other industries and many national large-scale projects. Titanium sector is the first of the eight business sectors of the company. During the 14th Five Year Plan period, under the background of the rapid growth of military titanium demand, the company takes titanium as the core, and takes the strong technical strength and process manufacturing capacity formed by years of technology research and development and accumulation as the support, actively expand other sectors, improve the industrial chain and actively release production capacity, Production efficiency and market share have been improved. The company adopts the production and operation mode of "order driven and production based on sales". According to the needs of customers, the company sells products in the direct sales mode through customized R & D and production.
Profit forecast and investment rating: continuously improve the core competitiveness, be optimistic about the medium and long-term development space, and maintain the "overweight" rating
The company adheres to the development strategy of creating famous brand products in titanium sector and other aspects to drive and improve the quality of other products of the company. The company's "localization project of key core materials for autonomous nuclear power plant" project has reached the expected usable state, and other projects are under construction. We believe that benefiting from the accelerated modernization of military equipment during the 14th Five Year Plan period, the company will actively promote product technology research and development and production capacity construction, and the revenue of titanium sector will maintain a rapid growth trend. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 131 million yuan, 280 million yuan and 331 million yuan respectively, with a year-on-year increase of 64.60%, 114.52% and 17.97% respectively. The corresponding EPS from 21 to 23 years will be 0.27/0.57/0.68 yuan respectively, corresponding to 55 / 26 / 22 times of the current share price PE respectively, maintaining the "overweight" rating.
Risk tips
1. The price rise of raw materials affects the profit growth; 2. The epidemic repeatedly affects order execution
