Hongya NC (002833) Company Review: Contrarian growth, comprehensive internal leadership in scale is expected to usher in double production capacity and market share in 2020
Three major growth logics: changes in the downstream furniture industry + optimization of the midstream structure + upstream integration to enhance competitiveness (1) The furniture industry has undergone tremendous changes: New house “precision decoration” policies and consumption upgrades have driven the penetration of customized furniture to increase, bringing intelligent equipment upgradesWith the expansion of production, demand for cost-effective equipment is even stronger.
(2) The competitive landscape in the equipment field continues to change: domestic equipment is becoming increasingly mature, independent research and development + extensional absorption of new technologies, and high-end models substituting imports for subtle influences are taking place; gradually, the concentration of head furniture industry and equipment is increasing at the same time.After two years of overcapacity and price competition in the furniture industry, the profitability of the furniture industry has increased, which has led to a new round of demand for capacity expansion.
(3) Cultivation of internal skills + industrial integration to enhance competitiveness: acquisition of upstream core component suppliers (AFC Champions, Sichuan Danya), layout software / control system field (Wang Shi Software (57.
25%)), technology extension reserves in the equipment field (wholly owned acquisition of Masterwood, Foshan, Pratt (25%), newly established Saizhi (35%)).
Three major catalysts: improvement of real estate completion + new capacity to help increase share + import substitution / expansion and promotion (1) The real estate industry is expected to usher in a gradual recovery of investment / sales / completion, and the demand for various sectors of the industrial chain will continue to boost; the furniture industryThe menstrual cycle lags behind the door and flooring industry slightly, production expansion is coming soon, and 19Q4 orders have begun to be recovered.
(2) In January 19, the company and Hongya CNC (Hong Kong) jointly established Guangzhou Master, mainly to undertake technology transfer from Masterwood in Italy.
In May 19th Master took 2.
With an area of 760,000 square meters, it is expected to expand its production capacity in the second half of 2020, which is expected to achieve technology transfer and upgrade and market expansion.
According to the recently announced convertible debt financing plan, the capacity of high-end mainframes and parts processing will be increased. It is expected that the average annual revenue will reach 16 in 2023.
280,000 yuan, net profit 2.
(3) New products (saizhi) / new technology (master) are expected to help cut into the supply chain of customers in medium and large furniture factories.
Among them, the large customers are mainly To C national / regional brands. Due to the needs of publicity and the cost ratio is not high, many foreign brands are preferred; medium-sized customers are mainly responsible for single-class customers in real estate factories, and require equipment performanceHigh but not demanding brands.
At the same time, comparing the sales data of the company with its peers, the company’s entire product categories such as edge banding machines, panel saws, CNC drills, and machining centers have become the first domestic brands.
We believe that comprehensive consolidation of the industry’s leading level is the result of long-term adherence to technology investment.
The operating data is excellent and it is expected to maintain good cash flow and continuous growth (1) Revenue in the first three quarters9.
85 billion (+5 year on year).
9%), net profit attributable to mother 2.
5.3 billion (+1.
9%), gross profit margin 37.
75%, net interest rate is 25.
99% (38 in the same period last year.
97% and 27.
25%); average net profit 3?
200 million (+10.
(2) Income in the third quarter 3.
27 billion (+2 year-on-year.
1%), net profit attributable to mother 0.
8.7 billion (+3.
6%), gross profit margin 37.
44%, net interest rate is 26.
84% (42 in the same period last year.
25% and 26.
91%); net profit for the fourth quarter was approximately zero.
6.7 billion (+110?
200%), if the goodwill impairment is accrued as in 18Q4, the profit will be even higher.
(3) Cash received from sales of products in the first three quarters10.
7.9 billion, net operating cash 上海夜网论坛 flow2.
3.8 billion, exceeding current income and current net profit, respectively, reflecting the changing right to speak on the channel. It is expected that the full issue model will be maintained.
Profit forecast: The company’s products have already ranked first in domestic production. It is expected to achieve rapid import substitution through the absorption of new technologies. Affected by the surrounding environment such as consumption upgrades and changes in land delivery standards, downstream demand will promote recovery after 2020.
Adjust the company’s 19-21 year net profit: 3.
100 million (previous value was 5.
800 million (previous value was 6.
82) and US $ 500 million. Even if the performance of the past year exceeds our forecast, considering that many of the company’s products have become the 深圳丝袜会所 first domestically produced, the industry consolidation and consolidation, maintain the “Buy” rating.
Risk Warning: Poor investment / completion in the real estate industry leads to a decline in the demand for the furniture industry; rising raw materials / labor prices lead to a decline in corporate profitability; peer price reductions cause the company’s revenue to decline;