Bo Shi (002698): High growth in 1H19 results in line with expectations Benefit from downstream capital expansion

Bo Shi (002698): High growth in 1H19 results in line with expectations Benefit from downstream capital expansion

Forecast 80% annual profit growth in 1H19?
120% Bo Shi shares released 1H19 performance forecast: it is expected to realize net profit attributable to mothers in the first half of 20191.

50,000 yuan?
1.

8 ‰, 80% increase in a year?
120%, in line with our budget performance expectations in “1H19 Machinery Industry Performance Preview: Segment Performance Differentiation, Continue to Recommend High-Growth Leaders”.

In the single quarter, the company’s 1Q19 revenue was 3.

500 million, an increase of 103% in ten years, net profit attributable to mother 0.

9 trillion, an annual increase of 324%; based on the company’s median performance forecast, the company achieved net profit attributable to its mother in the second quarter of 1919.

600 million, an increase of 168% in ten years.

Focus points The company’s traditional business benefits from downstream capital expansion.

In the first five months of 2019, the fixed asset investment in the petroleum processing industry increased by 17% year-on-year, and the single-month growth rate remained at a double-value level for the fifth consecutive month; in the first half of 2019, the fixed asset investment in the chemical industry exceeded 8%, sinceIt has continued to grow positively since the beginning of the month.

The steady growth in fixed asset investment in downstream industries has driven the company’s traditional business expansion.

In the first quarter of 19th, the company’s inventory and advance receipts increased by 63% and 105%, respectively, indicating that the company’s orders increased rapidly.

The rapid growth of strategic new products, the layout shows a trend of diversification.

The company’s self-developed high-temperature furnace front robot has been applied in batches in many household appliances companies nationwide, and we expect that this product will accelerate its growth in 2019.

At the same time, other new products of the company are expected to contribute new growth points: (1) The company is 北京桑拿洗浴保健 developing high-temperature furnace front-robots in the fields of ferrosilicon, silicon-manganese, and industrial silicon.

(2) Another new autoloader of the company is in the development stage, and it has extended 3 contracts over RMB 10 million in 2018, indicating that it has obtained preliminary approval from users.

BOA Environment turned losses every year in 1H19, and the environmental protection business has made positive progress.

Energy saving, environmental protection and environmental protection are one of the company’s important strategic development directions.

The company expects that Boao Environment, a 1H19 holding subsidiary, will exceed its losses and contribute profits.

In addition, the company democratically announced that Boao Environment and Shenghong Refining & Chemical Co., Ltd. ‘s multi-year waste 南京夜网 acid regeneration equipment proprietary equipment contract and patent license and engineering design agreement, the contract amount is 0.

4 trillion, the temporary signing of the contract marks the further positive progress of Boao Environment in related fields.

Estimates and recommendations We maintain the company’s 2019 / 20e profit forecast at 0.

32/0.

42 yuan is unchanged.

The current sustainable correspondence 2019 / 20e 27.

8/21.

1x P / E, we adjust the company’s target price from 33% to 9 based on equity distribution.

44 yuan, corresponding to 20 / 15x 2019 / 20e P / E, 8% growth space compared to current expectations, maintain “Neutral” rating.

Risks The single-year growth rate in the new millennium is lower than expected.