China Power (600482) 2019 Semi-annual Report Review: Military and civilian products business grows steadily

China Power (600482) 2019 Semi-annual Report Review: Military and civilian products business grows steadily

Event: In the semi-annual report for 2019, the company achieved a total operating income of 149.

890,000 yuan (+7.

38%), net profit attributable to mother 5.

2.7 billion (-35.

08%), gross profit margin 13.

17% (-1.

16pcts), net interest rate 3.

66% (-1.


Investment points Business scale increased.

From January to June 2019, the company realized 淡水桑拿网 operating income of 149.

890,000 yuan (+7.

38%); net profit attributable to owners of the parent company5.

2.7 billion (-35.


The return of net profit to mothers gradually decreased as the gross profit margin decreased from the previous period.

13pcts (adjusted), gross margin decreased by 1.

600 million, interest income in the current period decreased by 5994.

410,000 yuan.

Reporting information, the company received new orders 251.

40 trillion, with 238 orders held at the end of the period.

5.1 billion yuan; revenue from military products20.

44 trillion, revenue from civilian products 129.

4.5 billion.

Revenue from military products declined, and military reform orders were released or welcomed.

As a national key military enterprise, the company continues to maintain its top position in domestic 天津夜网 naval gas turbines, steam turbines, special batteries, integrated electric propulsion systems, military high-power diesel engines, heat engines, transmission systems and other power equipment.

However, due to the postponement of orders caused by the continuous advancement of the national military reform, the decline in the company’s military products revenue has decreased, resulting in a decline in comprehensive gross profit margin.

The core of the report achieved revenue 20.

4.4 billion (+3.

97%); military products accounted for 13.

64% (-2.


With the gradual release of military reform orders, it is expected that military products revenue will usher in a certain increase.

The private goods business has steadily increased, maintaining a good momentum.

The company’s civilian products business is divided into two categories: marine civilian products business and non-marine civilian products business.

Reporting information, non-marine civilian products business income 101.

5.8 billion (+33.

64%), revenue accounted for 67.77% (+4.


The non-shipping civilian products business with the three pillars of chemical power business, gas power business, and marine nuclear power business benefited from the civilianization of military technology, and the performance resumed steady growth.

Among them, the revenue of the chemical power business increased by 4 per year.

82%, double strengthening in technical innovation and market brand promotion, supporting in the first half of 2019, the market sales achieved a trend uptrend; Fengfan Torch Co., Ltd. re-established cooperative relationships with many important customers, and realized the first batch supply of high-end products.

Revenue from marine civil products business27.

8.7 billion (+16.

13%), with revenue accounting for 18.

59% (-1.


In the field of low-speed diesel engines, China’s ship-firewood integration work has continued to intensify. New diesel engine orders are based on the number of units received, and the power and contract value are increased by 27 compared with the first half of 2018.

12%, 21.

63% and 27.

72%, effectively increasing the domestic low-speed diesel engine market share to 35%.

Key scientific research projects have been implemented in depth, and the design of the standby power supply engineering prototype of the CHD622V16 land-based data center in the field of medium and high-speed diesel engines has been optimized.

Investment suggestion: The company’s military and civilian business is dual-driven. In the future, military products orders are expected to be further breakthroughs and releases. The market space for civilian products business is wide and performance is expected.

It is expected that the company’s net profit attributable to its parent from 2019 to 2021 will be 14 in the future.

50, 16.

53, 19.

61 trillion, EPS is 0.

86, 0.

98, 1.

16 yuan, currently corresponding to 29, 25, 21 times PE.

Risk warning: industry risk; risk of price fluctuations of main raw materials; exchange rate risk