Jiuli Special Material (002318): Downstream Prosperity Promotes Gross Profit Increase 19H1 Net Profit Increases 59%

Jiuli Special Material (002318): Downstream Prosperity Promotes Gross Profit Increase 19H1 Net Profit Increases 59%

The company announced its semi-annual report for 2019 and achieved net profit attributable to mothers in the first half of the year2.

110,000 yuan, an increase of 59 in ten years.

32%.

The company achieved operating income of 20 in 2019H1.

9.9 billion, an increase of 7 武汉夜网论坛previously.

69%, net profit attributable to mothers2.

11 trillion, an increase of 59 in ten years.

32%.

Among them, the second quarter achieved net profit attributable to mothers.

3.9 billion, an increase of 65 per year.

31%, an increase of 93.

90%.

Opinion: The company’s main business is stainless steel pipes. The profit trend is weakly correlated with the profit of ordinary carbon steel.

The company is the country’s largest industrial stainless steel pipe manufacturing company, with a stainless steel pipe capacity of 10 inches. Its main products are stainless steel seamless pipes and welded pipes.

We believe that due to the proportion of nickel in the cost of stainless steel as the main raw material, the impact of rising iron ore prices on stainless steel prices in the first half of the year is far less than the impact on ordinary carbon steel.The company’s net profit attributable to mothers continued to grow by 59%, and had better relative returns compared to the sector.

The downstream economy is improving and the gross profit margin of products continues to increase.

About 55% of the company’s revenue in 2019H1 expands the petrochemical and natural gas field, and it will continue to increase with reference to the proportion in 20185.

03 percentages.

We believe this is mainly due to the rising prosperity of the oil and gas industry. The orders and prices from the oil and gas sector have risen. Among them, the revenue of product in Q2 2019 reached a near high.

In addition, the gross profit margin of the oil and gas sector also increased from 28 in 2018.

46% further increased to 29.

83%.

The leading level of the industry improves the bargaining power of products.

The company’s market share has ranked first in the domestic industry for many years, the industry leader is obvious, and the product has a certain bargaining power.

In the first half of the year, the company’s seamless tube gross margin was 28.

19%, gross profit margin of welded pipe 24.

95%, gross margin score continued to improve in 2018.

Dating strategic partner Yongxing Materials.

The company dated Yongxing Materials as a long-term stable supply chain partner. It plans to purchase Yongxing Materials stock for no more than 600 million yuan, and the holding amount does not exceed 10% and not more than 20% of the total equity capital of Yongxing Materials.

We believe that Yongxing Material is the company’s raw material supplier. This strategic investment will effectively optimize the company’s upstream and downstream management system, improve resource allocation efficiency, and have a more stable source of raw materials.

Investment suggestion: A certainty breakthrough in performance growth and a “continuous market” rating.

Based on our calculations, we expect the company to achieve operating income of 44-2021 respectively.

67, 46.

93, 48.

880,000 yuan, net profit attributable to mother4.

33, 4.

74, 5.

1重庆耍耍网 1 trillion, the corresponding EPS is 0.51, 0.

56, 0.

61 yuan.

Based on comparable companies and historical premium levels, we give companies 16-20 times dynamic PE in 2019 with a reasonable value range of 8.

24-10.

30 yuan, given the “preliminary market” rating.

risk warning.

The prosperity of the oil and gas industry has declined; orders in hand have expanded significantly; and the economy has grown significantly.