Nanya New Material Technology Co.Ltd(688519) (688519)
Bulletin review
It was announced on the evening of November 30 that as of November 30, the company had repurchased 512632 shares through the trading system of Shanghai stock exchange through centralized bidding, accounting for 0.22% of the company’s total share capital of 234.4 million shares. The highest price of repurchase transaction was 46.00 yuan / share and the lowest price was 41.48 yuan / share.
Business analysis
Repurchase demonstrates confidence, and talent reserve is conducive to long-term development. The shares repurchased by the company will be used to implement the employee stock ownership plan or equity incentive. Considering that the company’s interest binding with newly introduced talents through equity during the period of rapid development will help to maximize the effectiveness of talents, we believe that the company’s repurchase at this time not only shows its confidence in its own operation, but also lays a foundation for future talent reserve.
The ability to cope with the cycle is better, and there is no need to worry too much. Through the resumption, we believe that leading manufacturers are expected to take the lead in getting out of the cycle haze by adjusting the relationship between pricing downstream and bargaining upstream. Further, we estimate from the company’s performance in the first three quarters that the gross profit of Q3 single sheet decreased by 13.8% relative to Q2, but still increased by 4.6% relative to Q1, which shows that the main factor for the decline of the company’s gross profit is that the unit price is too high, and the gross profit factor of single sheet still maintains the state of price increase premium when the demand boom is significantly weaker than Q1, indicating that the company has a good ability to cope with the cycle, If this state can be maintained, the company’s single gross profit is expected to take the lead in stabilizing and recovering in the future CCL industry cycle.
Actively expand production + large volume of high-end products to ensure profit growth. 1) The three-year compound growth of effective capacity was 26%. The company has opened a new plant in Jiangxi. According to the project progress, it is expected that the compound growth rate of effective capacity in the three years from 2021 to 2023 will reach 26%, and the release of energy will lay a foundation for growth; 2) The operation of Jiangxi plant is rationalized and profits are reaped. Since the beginning of this year, the production lines of Jiangxi plant have gradually run smoothly. At present, all three production lines of N4 plant have been fully produced, and the cost dilution has achieved initial results. In the future, after N5 and subsequent plants are put into operation, the cost will be further diluted, and the profit constraint is expected to be eliminated; 3) High end products are expected to be in large quantities after passing the certification. The company is one of the earliest manufacturers of high-speed copper clad laminates in China. At present, it is the only land-based copper clad laminate manufacturer with a full range of high-speed products of various grades certified by Huawei. In addition, the company is still developing high-end new products. We believe that the large volume of high-end products will provide guarantee for the long-term growth of the company.
Investment advice
We estimate that the net profit attributable to the parent company from 2021 to 2023 will be 410 million yuan, 570 million yuan and 730 million yuan, and the corresponding PE will be 26x \ 19x \ 15x. We will continue to give the “buy” rating.
Risk statement
The demand is less than expected; Falling prices lead to lower than expected profits; The ban on restricted shares was lifted.
