\u3000\u3 Shengda Resources Co.Ltd(000603) 949 Xuelong Group Co.Ltd(603949) )
Xuelong Group Co.Ltd(603949) deeply plough the engine cooling system for 20 years, master the industry-leading technology, and is a leading enterprise of commercial vehicle cooling fan. The company belongs to the auto engine parts industry, and its performance trend is related to the business cycle of downstream commercial vehicles, showing a fluctuating growth trend. The company’s revenue in 2020 was 488 million, a year-on-year increase of 33.5%, and the net profit attributable to the parent company was 146 million, a year-on-year increase of 46.3%.
The “national six” power assisted electric clutch fan assembly is updated rapidly. In terms of total volume, commercial vehicles are expected to be in a downward cycle in 22 years, but the sales volume of commercial vehicles will rebound to a certain extent around 2023, and the demand for engine cooling fans will also increase to a certain extent. In terms of structure, commercial vehicles should meet the national six standards and reduce emissions and fuel consumption in all links. Different types of fan assemblies have different effects on fuel consumption, so the introduction of national six standards has accelerated the replacement of new and old products to a certain extent, that is, the ordinary fan assembly is gradually transitioning to silicone oil clutch fan assembly and electronically controlled silicone oil clutch fan assembly, and the company is expected to benefit from this development trend.
The cooling fan is absolutely the leader, and the product upgrading drives the performance growth of the company. The company mainly has the following competitive advantages: 1) leading enterprise in the industry of clutch fan assembly of commercial vehicles, with high R & D level; 2) The company has the ability to independently manufacture cooling fan assembly materials, which is expected to improve the gross profit margin; 3) Product upgrading and overseas expansion bring new performance growth points to the company in the future. On the whole, the company is expected to maintain performance growth and consolidate its leading position in the industry by virtue of its competitive advantage.
Profit forecast and investment rating: the company’s revenue from 2022 to 2023 is expected to be 467 million yuan and 668 million yuan respectively, with a year-on-year increase of 7.7% and 42.8%; The net profit attributable to the parent company was 130 million yuan and 209 million yuan respectively, with a year-on-year increase of 13.6% and 60.4%. Considering the leading position of the company’s commercial vehicle cooling fan assembly, the subject matter has a certain scarcity, and the compound growth rate of the company’s net profit attributable to the parent company from 2021 to 2023 is a high level of 35%, using the peg relative valuation method, the company’s peg from 2022 to 2023 is 3.24x and 0.42x respectively, and the company’s peg in 2023 is smaller than the industry average. For the first time, give a “overweight” rating.
Risk factors: the macroeconomic downturn leads to the decline of consumption power, the rise of raw material prices leads to the decline of gross profit, the company’s production capacity layout is less than expected, the sales volume of commercial vehicles is less than expected, and the penetration rate of electric control fan assembly is less than expected.
