Longhua Technology Group(Luoyang)Co.Ltd(300263) (300263)
The company has new materials for strategic transformation, and the invisible champion is ready to go.
The company was originally a leading enterprise in energy conservation and environmental protection. In 2015, the company began strategic transformation of new materials and built a new material platform company through endogenous extension. In terms of polymer composites, the company actively formulated the military civilian integration strategy to open up long-term growth space; In terms of new electronic materials, the company has made great efforts in R & D, broken through foreign monopoly and become a leading enterprise in China’s industry.
Polymer composites: wind power rail transit is growing rapidly, and there is a broad space for military and civil integration.
The company has entered the field of polymer composites through the acquisition of zhaoheng, Haiwei and kebosi, and the three subsidiaries have become the leaders in the subdivided industry. Mega Technology: the only qualified supplier of PMI foam localization approved by China’s military is a significant beneficiary of import substitution. Haiwei composite materials: as a leading enterprise in ship lightweight in China, it is expected to fully benefit from the lightweight trend of naval ship construction; Cobos: in the field of rail transit, the company is the leader in rail damping system and rail composite products, with abundant orders on hand; In the field of wind power, the PVC core material produced by the company is the core material of wind power blades. Under the tide of wind power installation, the PVC core material is in short supply. The company raises funds and invests to expand production in time, and the future revenue is expected to double.
New electronic materials: the leader of sputtering target in China, and the two applications help the performance take off.
The company has broken through the monopoly of foreign technology in the target field and is a leader in China’s target industry. The three subsidiaries: Sifeng electronics, Jinglian optoelectronics and fenglianke have mastered the core technology in their subdivided fields respectively, driving the rapid growth of new electronic material business. Metal target: the company is the leading manufacturer of molybdenum target and the first high-quality manufacturer in China to overcome ITO target technology, with strong strength; ITO target: the downstream panel target will benefit from the promotion of localization and the penetration of OLED screen, and the prosperity will continue to improve in the future. As the next generation Cecep Solar Energy Co.Ltd(000591) battery, hjt photovoltaic cells (heterojunction cells) in the superimposed photovoltaic field have broad market demand for ITO target, and the company can take off as an industry leader.
Investment advice
We estimate that the net profit attributable to the parent company from 2021 to 2023 will be RMB 278 million, RMB 350 million and RMB 453 million, with corresponding P / E ratios of 34.17, 27.16 and 20.95 times. The company is rated as “overweight” for the first time.
Risk statement
The wind power and photovoltaic policies have disturbed the industry, the production line construction progress is less than expected, and the competition is intensified.
