Yinlun Shares (002126) Interim Review: Revenue Reversed Slightly Increased New Energy Thermal Management Expectable in the Future

Yinlun Shares (002126) Interim Review: Revenue Reverses Slight Increase in New Energy Thermal Management, Expectable Future
Event Overview The company released the 2019 Interim Report: 2019H1 achieved revenue 27.0 ppm, a 10-year increase of 2.7%; net profit attributable to mother 2.0 million yuan, ten-year average of 0.3%, net profit after deducting non-return to mother 1.4 ppm, an average of 24 over a ten-year period.4%.Among them, 2019Q2 revenue was 13.1 ‰, the ten-year average of 8.0%; net profit attributable to mother 0.9 ‰, ten years ago 7.1%, net profit after deduction is 0.6 ‰, 29 years ago.2%.  Analysis and judgment: The revenue has increased slightly against the trend, and the growth rate of automotive air conditioners has been dazzling.  2019H1 revenue growth in ten years2.7%. According to the data of China Automobile Association, the output of new energy vehicles in 2019H1 will further increase by 56%.3%, every 15 drops in passenger car output.8%, each drop of heavy truck output by 20.0%. We believe that the counter-trend growth is mainly due to the continuous improvement of product lines that can provide customers with a series of products and increase the value of supporting bicycles and the rapid growth of new energy thermal management business.  By business, 2019H1 heat exchangers, exhaust gas treatment, automotive air conditioners, and trade revenue were 18 respectively.500 million, 2.900 million, 3.600 million, 0.2 trillion, the annual growth rate is -0.4%, 2.1%, 54.0%, -11.6%.By region, the domestic and foreign sales revenue for 2019H1 will be 20 respectively.300 million and 6.60,000 yuan, an increase of 0 in ten years.3% and 10.5%.  Rising costs caused gross margins to fall, and research and development expenses increased significantly.  2019H1 gross profit margin 24.3%, a decline of 0 per year.7pct, mainly due to rising labor costs, tariffs on exports to the US business, changes in customer and product structure, etc.1) Business segment: heat exchanger and exhaust gas treatment gross margins are 25 respectively.3%, 8.5%, a decline of 0 per year.2pct and 1.6pct, gross margin for vehicle air conditioners is 24.7%, an increase of 0 a year.3 points.The decrease in gross profit margin of tail gas treatment was mainly due to the conversion of ERG from single supply to assembly supply. The purchase of EGR valves in and out of ERG assembly lowered the overall gross profit margin.2) By region: gross profit margins for domestic sales and export sales are 22 respectively.2% and 30.9%, down by 1 every year.0pct and 0.2pct, mainly affected by rising labor costs and tariffs.  2019H1 net profit 8.1%, a decline of 0 per year.5pct, mainly affected by the decline in gross profit margin.In terms of expenses, the 2019H1 sales expense ratio, management expense ratio, research and development expense ratio, and financial expense ratio were increased by 0.2, 0 pct, 1 pct, 0.2 points to 4.1%, 6.3%, 4.4%, 1.4%, which is affected by the increase of new projects and new products, R & D costs increased by 34 each year.5%.  In a single quarter, the gross profit margin in 2019Q2 was 23.7%, down by 0 every year.4pct, down 1 from the previous month.2pct; net interest rate 7.9%, basically flat for a year, down 0 from the previous month.4pct.In terms of expenses, R & D expenses increased by 1 in Q2 2019.5 points, the management expense ratio decreased by 1 from the previous quarter.0pct, sales expense ratio increased by 0.5 points.  New orders for new energy thermal management and EGR are expected to maintain high growth.  1) New energy thermal management business received new orders and entered a fast-growing channel: since 2018, it has successively obtained fixed-point suppliers such as Geely’s PMA platform, Changan Ford and Jiangling New Energy. Recently, the company has also obtained new energy from Ningde Times supporting BEV3With the increase in market recognition of water-cooled plate orders, the company’s future development 深圳桑拿网 of new energy thermal management business expands more customers and continues to grow rapidly.2) The implementation of the National Sixth Standard will increase the demand for exhaust gas treatment products such as EGR and deliver replacements to enhance the supporting value of bicycles. Recently, the company has won orders for GAC passenger car EGR products. It is expected to start supporting GAC 2 in 2020 and 2021.0TM and 1.5TG engine platform.With the gradual implementation of the National Sixth Standard, exhaust gas treatment products such as EGR are expected to significantly increase in the application of commercial vehicles. At the same time, EGR will gradually shift from single supply to assembly supply to increase the supporting value of bicycles. Volume and price will drive exhaust gas such as EGR.Processing 都市夜网 business is growing rapidly.  Investment suggestion The company is a leader in the field of thermal management. New customer development and supply reorganization drive the growth of traditional thermal management business performance. The new energy thermal management business will fully enjoy the rapid development of the industry as an important profit growth point. Exhaust gas treatment products will benefit fromThe implementation of the National Six Standards has achieved rapid growth.It is expected that the revenue for 2019-2021 will increase by 3 respectively.7%, 13.2%, 21.5%, reaching 52.100 million, 58.900 million, 71.600 million, net profit attributable to mothers decreased by 1.2%, an increase of 15.6%, an increase of 26.1%, reaching 3.500 million, 4.0 billion, 5.0 million, EPS is 0.43 yuan, 0.50 yuan, 0.63 yuan, corresponding to the current PE 16 times, 14 times, 11 times.Reference industry average PE 15-20 times, considering the company’s new energy business and ERG become growth, given the company 16 times PE estimates in 2020, target price 8.02 yuan, for the first time, give “overweight” rating.  Risk warnings The passenger car industry sales are less than expected; the development of new energy vehicle-related products is less than expected; the price of raw materials has risen; the impact of Sino-US trade friction on US business