Baofeng Energy (600989): Demonstration of medium- and long-term growth of coal-based polygeneration demonstration 淡水桑拿网 enterprises
Core point of view: Company profile: Coal-based polygeneration develops economy, profitability is outstanding. The company is rooted in the core area of Ningxia National Ningdong Energy and Chemical Industry Base. After more than ten years of development, the company integrates international and domestic first-class technology and equipment.A multi-generation circular economy industrial chain of “coal, coke, gas, methanol, polyolefin, polyethylene, polypropylene, and fine chemicals” has been formed.
At present, its main business includes three business segments including glycerin, coking and fine chemical products. In the first half of 2019, revenues accounted for 44%, 43% and 13%, respectively.
Since 2007, the company’s coking, sedimentation and other industries have gone through several cycles of 四川耍耍网 change, but the company’s business scale has continued to expand. In 2018, the company’s operating income and net profit attributable to its mother were 130.
5 and 37.
0 billion, the compound growth rate has reached 60% and 53% respectively in the past 11 years.
Revenue and profit for the first half of 2019 were 65.
200 million yuan (+9 per year).
7%) and 18.
90,000 yuan (+38 a year).
1%) and outstanding profitability.
Industry Trends: Coking continues to improve its competition for capacity reduction, and there is still room for continuous internal development. It is also expected to focus on the formation of carbon prices.
In the medium and long term, through coking capacity reduction, gradual landing of new capacity, the orderly launch of new capacity, improved industry competition, increased concentration, and the coke price center will help maintain stability and increase.
Crude oil: At present, the production of naphtha billet is still the mainstream production process. The fluctuation of crude oil price has a relative proportion of the price of subdivided products. The medium and long-term price is expected to continue to run at a high level with the fluctuation of crude oil price.
At present, the average domestic consumption per capita, the dependence on imports is relatively high, transforming the increase in per capita consumption and domestic substitution, and the medium and long-term domestic consumption industry still has room for development.
Company highlights: Obvious resource advantages, complete integrated industrial chain, prominent cost advantages, and prominent expansion of the company’s competitive advantages are mainly reflected in the following aspects: 1) The company has a good location advantage, obvious resource advantages, and is weakened by industrial policy support and fiscal and tax incentives.
The company currently has Maliantai Coal Mine (capacity of 360 tons) and Siguquan Coal Mine (capacity of 150 tons). The coal self-sufficiency rate is about 41%.
According to the company’s 2019 Interim Report, the company’s construction of Hongsi Coal Mine (240 tons / year) and Dingjialiang Coal Mine (60 tons / year) finally ended production.
2) The industrial scale of Ningdong Energy Base, the company’s circular economy industrial chain is perfect, and its production technology is advanced.
3) The company has obvious advantages in multi-input costs such as investment and operation, and its ability to resist risks is replaced.
General point of view: Coal-based polygeneration demonstration enterprise. The company that is worthy of attention in the long-term growth is a coal-based polygeneration circular economy demonstration enterprise. It has a good geographical advantage. The company has coal coking, coal-to-methanol to oxide, and coke.Integrated industrial chains such as gasification granulation and deep processing of fine chemical products, and have adopted a variety of advanced production technology.
In addition, as an excellent private enterprise, the company has strong cost control and outstanding profitability in many aspects such as investment and operation.
In the medium and long term, after the second and third phases of the project are gradually completed and put into production, the company’s future business scale and profit growth space can also break through.
The company’s EPS is expected to be 0 in 2019-2021.
71 and 0.
78 yuan, corresponding to 20 for dynamic PE.
2 and 14.
With reference to comparable companies’ estimates, taking into account the company’s medium- and long-term growth, we give the company a 22-year PE valuation of 22 times, corresponding to a reasonable value of 11.
92 yuan / share, covering for the first time, give “overweight” rating.
Risks suggest that the macroeconomic growth rate is higher than expected, and downstream demand is lower than expected. Baseline, coking and other industries’ excessive production capacity has led to excess capacity, yields, and prices of major products such as coking have fallen, and the company’s new project progress has exceeded expectations.