Hongfa Co., Ltd. (600885): High-voltage DC relays have a high increase in general use, and automotive relays have a low stage

Hongfa Co., Ltd. (600885): High-voltage DC relays have a high increase in general use, and automotive relays have a low stage

The company released the 2019 semi-annual report.

In the first half of 2019, the company achieved revenue of 34.

0.7 million yuan, an increase of ten years.

53%; comprehensive gross profit margin 38.

37%, rising by 0 every year.

17 points; net profit attributable to mother 3.

55 ppm, a decrease of 3 per year.

42%.

In a single quarter, the company achieved revenue of 17 in the second quarter of 2019.

82 ppm, an increase of ten years.

27%; comprehensive gross profit margin 38.

55%, rising by 1 each year.

63pct, up 0 from the previous month.

38pct; net profit attributable to mother 1.

97 ppm, a decrease of 1 per year.

60%.

High-voltage DC relays continue to increase.

In the first half of the year, the company replaced about 2 high-voltage DC relays.

500 million, an increase of 55% in five years.

The company’s high-end customer development achievements, in addition to the rapid expansion of 40% in the country, in the overseas market have successively obtained Land Rover, Porsche, Volkswagen MEB, Mercedes-Benz, Ford, Tesla, Samsung battery and other major suppliers designated major supplier certificates.

We believe that this year is the first year of the company’s supply to overseas auto companies. Tesla, Volkswagen, Ford and other key overseas customers are expected to drive the company to gradually and continuously increase volume.

We expect that the compound revenue growth rate of high-voltage DC relay business in the next 3-4 years is expected to reach about 40%.

Power relays have picked up significantly.

In the first half of the year, the company’s power relays replaced about 7.

5 ppm, an increase of 23 in ten years.

5%.

The company’s main product, the magnetic latching relay, can be accelerated by the second round of China National Grid’s reloading, as well as the overseas French online volume, the British Internet, and the US Open market share have further increased, showing a rapid growth trend.

We expect the growth momentum to continue in the second half of the year, and is expected to achieve a 20-30% growth rate.

Industrial control, signal relay, and low-voltage switch have a stable growth rate.

In the first half of the year, the company’s industrial control relays replaced about 2.

800 million, an annual increase of 23.

3%; signal relay consumes 1.

700 million, an increase of 19%; low-voltage switch investment 3.

0 million yuan, an increase of 15.
.

3%.

In the past two years, the company has increased the technical development of industrial control products, and the overall efficiency has improved significantly. Signal relays have mainly benefited from the gradual increase in demand for projects in the security field and breakthrough customers in the field of industrial testing and medical testing equipment.client.

We expect the company’s industrial control and signal relays to continue to grow steadily in the next two years, reducing the increase in growth in 杭州桑拿网 the next two years.
General-purpose, short-term pressure on automotive relays.
In the first half of the year, the general relay frequency converter was about 14 trillion, which dropped by more than 7.

29%, automotive relays total about 3.

800 million, a year-on-year decrease of 25%.

The demand for general relays in the overseas market has grown steadily, but in the first quarter, the international relay giants in the domestic white goods market took the lead to provoke fierce market competition. In the second quarter, the market gradually stabilized. We expect to gradually stabilize the second half of the year.The overall decline in the market exceeded expectations, potentially affecting the company’s existing market and customers.

In the second half of the year, the company will increase the promotion efforts for new customers such as Mercedes-Benz and BOSH, to prepare for the follow-up volume, and open up new space for the growth of this sector in the future.

to sum up.

Overall, we believe that: (1) The company is general, and automotive relays are at a low stage. From the downstream demand of the sector and the company’s customer expansion, we expect that the sector will help us to improve from the end of this year or early next year.

(2) High-voltage DC relays and power relays are fast-growing segments in the first half of the year and are expected to drive the company’s growth this year.

(3) Low-voltage electrical appliances. We expect that through the easing of the increase in production capacity, it is expected to show rapid growth in the next few years.

Profit forecast and estimation.

We estimate that the company’s net profit attributable to the parent in 2019-2021 will be 7, respectively.

7.1 billion, 9.

01 ppm, 10.

6.2 billion; budget revenue is 1.

04 yuan, 1.

21 yuan, 1.

43 yuan.

The company’s global market share of relays is leading, outstanding, and achieved global competitiveness. With reference to comparable companies, the company is given 25-30 times PE in 2019, corresponding to 26.

00-31.

20 yuan / share, preliminary market rating.

risk warning.

Overseas car companies cut into progress less than expected, dollar exchange rate risk, market competition risk