Anhui Yingliu Electromechanical Co.Ltd(603308) (603308)
Aviation casting is a core supplier, and its products have entered the supply chain system of international leading enterprises. The company was established in August 2000. At the beginning of its establishment, it was mainly engaged in the production and sales of steel castings. With the extension of the company’s industrial chain and the improvement of product positioning, the company began to engage in R & D and production of precision castings, and established cooperative relations with international famous companies such as Caterpillar and Siemens. Relying on the company’s technical advantages in casting and machining, the company has successively entered the high-end equipment manufacturing fields such as nuclear power equipment, aero-engine and Gas Turbine Casting Superalloy blades, and successfully entered the supply chain system of international leading enterprises such as RORO and Ge. At present, the company is a leading enterprise in the field of special equipment parts production and an important supplier of core enterprises in the fields of China National Nuclear Power Co.Ltd(601985) , oil and gas and aviation. The company has maintained the first export volume among China’s valve parts export enterprises, the highest delivery volume of nuclear power equipment parts, and continuously ranked among the top 100 enterprises in China’s machinery industry.
The traditional casting business has competitive advantages, and the business is expected to gradually pick up. The company has a complete industrial chain of special equipment parts manufacturing with casting as the source. In terms of technology R & D, product manufacturing and quality assurance, it is in a leading position in China and reaches the international advanced level. It is one of the few enterprises in China that can produce super austenitic stainless steel, duplex stainless steel, martensitic stainless steel and superalloy parts and components and apply them to clean and efficient power generation equipment and oil and gas equipment. With the global economic recovery and the gradual easing of the epidemic, the company’s traditional casting business is expected to gradually pick up.
There is strong demand in the downstream of the aviation field, and the market space for the blades of the two engines is broad. Since its listing in 2014, the company has continuously invested in R & D in the field of two machine blades. At present, the company has the core manufacturing technology of precision casting of Superalloy blades, ranks among the top in the world in the production capacity of directional single crystal blades, has accumulated international well-known customers such as Ge, Siemens and Honeywell, and has the authoritative qualification certification in the industry at home and abroad. During the “14th five year plan” period, the downstream demand of China’s aviation industry is strong, and the market space of two aircraft blades is broad. We expect that the average annual market space of two aircraft blades will be close to 90 billion yuan in the next 10 years. The company has been deeply engaged in the field of two machine blades for many years, has core competitive advantages in technology and production capacity, and will fully benefit from the significant improvement of market prosperity in the aviation field.
Domestic third-generation nuclear power technology has been verified, and the nuclear power business has ushered in a performance inflection point. On the one hand, with the implementation of the “double carbon policy”, clean energy needs to be further developed. With the popularization of unstable energy such as wind and light, the status of nuclear power as a base load power source has been rebuilt, and the prosperity of the nuclear power industry has rebounded. On the other hand, with the verification of China’s “Hualong 1” and other third-generation nuclear power technologies, domestic third-generation nuclear power units have met the conditions for large-scale construction, and China is expected to usher in a new round of nuclear power construction. The company is one of the core suppliers of nuclear power equipment and one of the few private enterprises with first-class nuclear qualification. The company’s products are mainly used in the construction stage of nuclear power plant and the later spent fuel storage, transportation, post-treatment and other fields. The products are located in the core link of the nuclear power equipment industry chain. With the implementation of policies and the recovery of nuclear power demand, the company’s nuclear power business will fully benefit from a new wave of nuclear power construction, and the nuclear power business will usher in an upward turning point.
Profit forecast and investment suggestion: benefiting from the high prosperity of the military industry, the company’s two-level blade orders are expected to be in high volume rapidly. With the verification of domestic third-generation nuclear power technology, the company will fully benefit from a new wave of nuclear power construction, and the nuclear power business is expected to usher in an upward inflection point. We expect that the company’s revenue in 2021, 22 and 23 will be RMB 2.057/24.39/2.950 billion respectively, the net profit attributable to the parent company will be RMB 229/5.06/397 million respectively, the corresponding EPS will be RMB 0.34/0.74/0.58 respectively, and the corresponding PE will be 69.32/31.38/40.03 times respectively. For the first time, give a “buy” rating.
Risk warning: the order of two-stage blades is not as expected; The development of traditional casting and nuclear power business is less than expected; Market space measurement deviation risk; Risk of price fluctuation of raw materials; Risks of uncertain overseas business; The risk of uncertain land acquisition and storage; The public data used in the research report may have the risk of information lag or untimely update.
