Superstar Technology (002444) Company dynamic comment: Maintaining steady growth in trade tensions, acquiring Zhongce Rubber, expanding aftermarket channels
The performance has been developing steadily, and export-oriented enterprises are facing tariff risks: According to the company’s interim report performance report, operating income will be realized in the first half of 2019.
38 ppm, an increase of 38 in ten years.
The company is the third largest manufacturer of hand tools in the world. By leveraging the four major advantages of innovation, brand, channel and internationalization, and highlighting the characteristics of omnichannel, the tool business has achieved sales revenue26.
55 ppm, an increase of 40 in ten years.
63%, has become the main driving force to increase operating income.
Net profit attributable to shareholders of listed companies was 4 in the first half of the year.
440,000 yuan, up 38 in the same period last year.
In the first half of the year, the company worked hard to expand channels and even reduced sales expenses and financial expenses more than doubled. However, in the first half of the year, the increase in other income from government subsidies contributed to the increase in net profit.
In the second quarter of 2019, operating income exceeded expectations by 20.
22%, slightly faster than the growth rate of Q1.
However, the growth rate of net profit attributable to mothers increased from the morning quarter to 42.
87%, related to the benefit concessions implemented from April 1.
Obviously, due to the impact of the Sino-US trade war, the company’s smart product business is the most affected by the US tariff policy suppression.
There are still uncertainties in the future trade situation. More than 94% of the company’s main business income comes from abroad. Although it is a leader in the industry, it still faces challenges.
The trade environment is unfavorable, and the advantages of sales channels are actively used: the company accounts for 4% of China’s exports of American hand tools, and has a market share of 3% -4% in the US market.
In the announcement of the impact of US taxation on the company issued in August, it was stated that the Sino-US trade friction will not have a significant adverse impact on the company’s future production and operation and financial status, and its continued profitability.
The company actively responds to challenges, uses leading advantages, accelerates product development and expands sales layout, and expands the needs of more people.
In terms of supply chain, the company’s acquisition of Prime-Line in North America in the first half of this year has become one of Asia’s largest hardware tool 西安耍耍网 suppliers such as LOWES, HOMEDEPOT, WALMART, BRICODEPOT, CTC and other large European and American supermarket chains.
In addition, it has also developed new channels such as e-commerce, its own-brand dealer system and direct supply to major customers.
Especially in the area of smart product business, shifting the focus of production capacity layout, it is necessary to completely manufacture the foundation and independent intellectual property rights to avoid the suppression of US tariffs.
In the semi-annual report for 2019, the company’s construction in progress has increased by 366 for many years.
02%, notes receivable increased by 96 in ten years.
In the unfavorable trading environment, in addition to improving product manufacturing and distribution capabilities, the company is committed to taking advantage of its size and diversifying risks through possible scale effects of investment layout.
In terms of operating model, the pricing of export products is FOB, import tariffs are borne by customers, and manufacturing costs are replaced, and products are replaceable.
But once the United States uses sanctions, it will affect orders and be detrimental to the company’s development.
Acquiring Zhongce Rubber to expand the market after the automobile: The company’s products are widely integrated in the manufacturing and processing industries. In the field of auto repair, the company’s main products mainly include professional tool boxes and cabinets.
In order to fully grasp the development potential of the automotive aftermarket, the company intends to establish in-depth cooperation in market channels through the acquisition of Zhongce Rubber, to further expand the product layout in the automotive aftermarket area, and to improve the level of automotive repair and maintenance services.
It is reported that the latest draft of the transaction disclosed by the company, the superstar technology and Hangcha Group at a price of 1 yuan to the holding platform Zhongce Haichao increased capital by 1.1 billion US dollars, and obtained Zhongce Haichao27.
After the capital increase is completed, Zhongce Haichao will pay cash to purchase the equity of Zhongce Rubber held by eight counterparties. The amount of its own funds and bank merger loans will account for 46 of Zhongce Rubber’s registered capital.
95%, and obtained a controlling stake in Zhongce Rubber.
Superstar Technology will indirectly hold Zhongce Rubber12.
After the completion of the transaction, Zhongce Rubber will not divide the scope of the company’s consolidated statement, and the company’s main business structure will not change due to the transaction.
Zhongce Rubber has a strong internal sales and service network, which will provide the company with access to the auto repair market. Zhongce Rubber is expected to rely on the company to enter the supplier list of large North American retailers, but at present, the North American market risks increase, orWill affect the realization of synergies. Investment suggestion: We predict that the company’s EPS for 2019-2021 will be 0.
80 yuan, 0.
90 yuan and 0.
98 yuan, corresponding to PE is 14 times, 12 times and 11 times.
Maintain the “Recommended” level.
Risk reminder: the risk of higher tariffs leading to higher costs; the risk of RMB exchange rate; trade friction leading to fewer orders.