Hailiang Co. (002203) Company In-depth Report: Cost Advantage Construction, Wall Construction, Capacity Expansion, Consolidation of Leading Position
The year-on-year growth of copper processing capacity has promoted steady growth in performance: from 2015 to 2018, the company gradually increased its production capacity through self-built projects, technological transformation and cross-mergers, driving revenue and net profit growth for three consecutive years.
At the end of 2018, the company has a copper pipe production capacity of 58 inserts, copper rods 7 inserts, and copper rows 2 inserts. At present, there are more than 50 copper processing materials under construction, and the expected capacity growth in the next two years.
In the first half of 2019, the company successfully acquired the copper alloy rod and copper pipe business where the global copper processing industry leader KME is located, inserting 28 into the copper alloy rod production line and 5.
The 2-lead copper tube production line was included in the bag, and subsequently opened up the European market.
As the company’s self-built capacity is put in batches, overseas M & A projects gradually contribute to profits, and the company’s performance growth is worth looking forward to.
Steady operation without fear of fluctuations in copper prices. Intelligent production creates cost advantages: the company only earns processing fees and does not earn copper prices. It completely hedges raw materials, completely eliminates raw material price risks, and guarantees stable profits.
At the same time, the company continued to reduce costs and reduce costs, and improved the level of intelligent automated production. The production efficiency of the single production line exceeded the industry average by 40%, which significantly improved its competitiveness.
At present, the company’s gross profit per ton of copper processing material is stable at around 3,000 yuan, and the gross profit per ton and the overall gross profit margin are second only to the production of high-end copper alloy materials in the industry.
With the launch of many new intelligent information production projects around 2020, the company’s advantages in production efficiency will be further consolidated, and the profit level is expected to increase again.
The copper pipe industry gradually integrates the company as a leader to gain resources. The domestic copper pipe market shows that Hailiang Co., Ltd. and Jinlong Copper Pipe are both strong and strong, and there are many small and medium manufacturers. Due to the limited processing capacity of channels, small and medium manufacturers are difficult to obtain stable orders.Will be gradually phased out, the industry will gradually enter the integration phase.
Hailiang is backed by the world’s top 500 Hailiang Group, and is committed to integrating order resources and background advantages. Through mergers and acquisitions and self-built capacity, it gradually increases the industry’s city share and consolidates its leading position.
Future performance with strong output growth expectations is worth looking forward to: The company’s future production volume is expected to be strong. At the same time, the company’s stable operating model and consolidated leadership can ensure the stability of profitability, and future performance is worth looking forward to.
We expect the company’s net profit to reach 12 in 2019-2021.
8.4 billion; corresponding to EPS0.
91 yuan / share, corresponding to PE16.
57 times, give “recommended” rating.
Risk warning: production capacity is less than expected copper 深圳spa会所 processing fees on a regular basis