Zhongke Sanhuan (000970): Shangtuo Resources, deep cultivation of rare earth magnetic materials leading into a new cycle of new energy growth
The main points of the report are to expand resources, deepen manufacturing, and lead the rare earth magnetic materials into a new cycle of new energy growth. Zhongke Sanhuan is the pioneer and leader of the rare earth magnetic materials industry in China.Grow into the top supplier of global rare earth magnetic material industry.
There are three core investment logics: (1) The company adheres to “endogenous” development and gradually realizes product breakthroughs in high-end fields such as VCM, EPS, and new energy vehicle drive motors. The production scale has expanded from about 1,000 tons at the time of listing to about 1 at present.
6, ranking first in the world, the company’s sintered NdFeB production capacity will increase to about 2 in the next three years.
(2) New energy vehicle drive motors have a high level of customization of magnetic materials and strong customer stickiness after mass production. The company has strong R & D and production 深圳spa会所 capabilities, and is the first to merge Tesla and other world-class new energy vehicle supply chains with customer reserves.First mover advantage is obvious.
(3) The company plans to hold a 5% share of Nanfang Rare Earth in the form of capital increase and share expansion, and both parties plan to jointly invest in Ganzhou to establish a high-temperature sintered NdFeB project with an annual capacity of 5000 tons.
We believe that through cooperation with Southern Rare Earth Group, the company’s ability to acquire rare earth raw materials, especially heavy rare earth raw materials, will be further enhanced, leading to a qualitative leap in the company’s stable supply capacity.
China’s supply has reshaped the global supply chain, global electrification has given rise to a new round of development and changes, and the rapid growth of demand in new energy vehicles, smart manufacturing, and energy-saving appliances. The high-end rare earth magnetic material industry is ushering in a new round of development possibilities:1) It is estimated that by 2020, the global demand for high-end rare earth magnetic materials will be about 8.
8Each year, the compound growth rate of 2018-2020 is about 13%; especially in the field of new energy vehicles, the compound growth rate is expected to be about 45% in 2018-2020.
(2) Recently, Japanese manufacturers have actively deployed new energy magnetic materials business. Based on the traditional and stable strategy of “effective demand for capacity expansion” by Japanese companies, their strategic layout has also increasingly demonstrated the certainty of demand.
On the supply side, benefiting from its unique rare earth resource advantage and support from industrial policies, China has become a global rare earth magnetic material manufacturing center.
We believe that the Chinese magnetic materials companies rooted in the “rare earth fertile soil” have both cost advantages and raw material guarantee advantages. Leading magnetic material manufacturers will strive to harvest higher high-end orders and gradually grow into a global high-end rare earth magnetic material industry leader.By.
New energy magnetic materials orders are heavy, and the product structure is continuously optimized. The “Buy” rating is given from 2019 to 2020. The global “Electricization Wave” is committed to embracing substantial breakthroughs. The company is developing customers, raw material layout, high-end capacity reserves, and technology research, Patent layout and other aspects have been prepared, is expected to benefit from the release of new energy demand into a new round of growth cycle.
In the first quarter of 2019, the company’s gross profit margin increased by about 1.
Nine averages, the net interest rate increased by about 0.
1 unit, the net operating cash flow increased by about 1 month.
The company’s production and operation have significantly improved margins. It is estimated that the company’s operating income will be 45 in 2019, 2020 and 2021.
500 million, 54.
800 million, 66.
200 million, net profit attributable to mothers are 2 respectively.
900 million, 3.
700 million, 4.
800 million, eps are 0.
27 yuan, 0.
34 yuan, 0.
Corresponding PE is 41X, 33X, 25X, which gives the company a “Buy” rating.
Risk Warning: 1.
Global electrification progress is less than expected, global macro fundamental risk, etc .; 2.
The risk that rare earth permanent magnet motor technology will be replaced by new materials and technologies.