16 Mar

Zhejiang Longsheng (600352) Annual Report Comments: Performance Meets Expectations Leading Company Advantages Significant

Zhejiang Longsheng (600352) Annual Report Comments: Performance Meets Expectations Leading Company Advantages Significant

Investment highlights: Event: The company released the 2018 annual report, and the company achieved operating income of 190 in 2018.

750,000 yuan, an increase of 26 in ten years.

32%, achieving net profit attributable to shareholders of the parent company.

110,000 yuan, an increase of 66 in ten years.

2%.

  The company’s performance has grown rapidly, and its safety and environmental protection advantages have become increasingly 厦门夜网 prominent.

The domestic environmental protection rectification continued in 2018. As a leading company that continues to improve safety and environmental protection, the company’s competitive advantages have further expanded. The company’s operating income and profits have achieved double breakthroughs, setting a record high.

  Chemical companies have increased their safety, and the company’s advantages have become increasingly prominent.

It is expected that the requirements of national chemical companies for safe production will be further strengthened in 2019.

The company dated DuPont Sustainable Solutions (DSS project) in safety management to prevent accidents from improving safety culture and controlling risk sources.

The company’s strong security advantages will gradually reflect its valuable value.

  Resorcinol anti-dumping continues, and the company’s products are expected to maintain a high level of prosperity.

On March 22, 2019, the Ministry of Commerce announced that the investigation authority ruled that if anti-dumping measures are terminated, dumping of resorcinol from Japan and the United States on China may continue or reoccur, and damage to China’s domestic industry may continue.Or it happened again.

The Customs Tariff Commission of the State Council has made a decision based on the recommendations of the investigating authority. From March 23, 2019, anti-dumping duties on imports of resorcinol from Japan and the United States will continue to be imposed for a period of five years.

Tax refund for Japanese companies such as Sumitomo 40.

5%, tax arrangements for US companies such as Intis Parker 30.

1%.

Resorcinol is expected to maintain a high boom.

  The company’s industrial chain has significant advantages.

The company has extended from a single dye product to other special chemicals, taking the integration of the industrial chain as the core to the production of related intermediates such as resorcinol, p-phenylenediamine, and the development and reduction of aromatic amine intermediates such as reduced compounds.And extend the upstream of the dye supply chain, strengthen the control range of strategic intermediate raw materials, thereby further improving the right to transform dye products, so that peer companies generate certain returns.

It is expected that the company will enrich its product line through continuous internal research and development supplements and external mergers and acquisitions, and will eventually become a world-class special chemical production service provider across multiple fields.

  Positive return on operating cash flow is of great significance.

In 2018, the company’s operating cash flow was a net inflow of 10.

7.6 billion, and -2 in 17 and 16 respectively.

5.9 billion, -60.

7.5 billion, operating cash flow is back to confirm that the company’s three major real estate projects in hand are nearing the harvest stage.

It is expected that the company’s operating performance will maintain rapid growth in 19 and 20 years, and the consolidated Datong Road real estate project will gradually enter the pre-sale repayment stage. The company’s net operating cash inflow is expected to show explosive growth.

In addition, the Huaxing New Town project has completed the relocation and overall design of all residents, and joined the 2019 major start-up project in Jing’an District.

  Earnings forecast and investment rating: We raise the company’s performance expectations. It is estimated that the company’s operating income from 2019 to 2021 will be 20.9 billion, 25.9 billion, and 36.2 billion, respectively; net profit attributable to mothers will be 5.5 billion, 6.4 billion, and 770,000 yuan; EPSThey are 1.

69 yuan, 1.

97 yuan and 2.

37 yuan, corresponding PE is 11X, 10X and 8X.

Maintain the “Highly Recommended” rating.

  Risk reminders: 1. Downstream demand exceeds expectations; 2. Raw material prices fluctuate significantly.