Longji shares (601012): Performance growth is bright, convertible bonds escort growth

Longji shares (601012): Performance growth is bright, convertible bonds escort growth
Event: The company released the third quarter report of 2019: January to September realized operating income of 226.90,000 yuan, an increase of 54 in ten years.7%; net profit attributable to mother 34.80,000 yuan, an increase of 106 in ten years.0%, net profit after returning to mother after deduction of 34.1 ppm, an increase of 114 in ten years.6%. Demand for silicon wafers continued to boom, and the company’s third-quarter performance growth rate was dazzling. The company’s Q3 single-quarter revenue reached 85.80,000 yuan, an increase of 83 in ten years.8%, net profit attributable to mother 14.70,000 yuan, an increase of 283 in ten years.9%.The growth rate of the company’s performance is dazzling, initially: 1) The wafer end is profitable, and the revenue of Q3 wafers is about 35.300 million US dollars, a year-on-year increase of 122%, the gross profit margin increased to about 32%, benefiting from the continued tight supply and demand in the monocrystalline silicon wafer market, the company’s silicon wafer prices are firm, replacing the second phase of Yunnan’s production capacity climbing and non-silicon costs,The volume of silicon wafer business achieved both volume and profit; 2) The growth of the module side was steady, with Q3 modules achieving revenue of approximately US $ 2.8 billion, an annual increase of 12% and a gross profit margin of approximately 23%.Affected by the late start of the domestic photovoltaic installation market this year, module prices improved in the third quarter.We believe that it is expected to gradually achieve the peak expansion of domestic photovoltaic installations and continue to expand overseas markets. The fierce market demand will support the monocrystalline wafer prices to continue to be firm, the component prices to stabilize and recover, and the company’s performance is expected to continue to maintain a steady growth trend. Profitability has steadily improved, 杭州桑拿 cash flow has continued to improve, and companies with outstanding fee control capabilities have a gross profit margin of 29 in Q3 2019.9% (ten years +8.6pct, ring than +1.9pct), and profitability has steadily improved.Operating cash flow continued to improve, and net cash inflow from operating activities in the third quarter.900 million US dollars, the proportion of invoices receivable exceeded all the construction decline, reflecting the company’s good cash management and operating efficiency. 2019Q3 three rates total 7.5% (twice -2.9pct), excellent fee control.Single quarter selling expense ratio 3.3% (year -1.6pct), management expense ratio 2.9% (decade -0.5pct), R & D expense ratio is 0.9% (decade -0.3pct), financial expense ratio is 0.4% (one year-0.4pct). The convertible bonds escorted the production capacity layout, and the single crystal leader continued to grow rapidly. The company plans to publicly issue convertible bonds of US $ 5 billion for investment and construction of Yinchuan’s 15GW monocrystalline silicon rods, wafers and Xi’an 5GW monocrystalline battery projects.The company initially announced that it will complete the production capacity layout of 65GW silicon wafers, 20GW battery cells and 30GW modules by the end of 2021. It will complete the silicon wafer expansion plan by one year to the end of 2020 in the interim period, highlighting the company’s capacity expansion and future operations.Confidence and determination.In terms of market, the company has gradually completed the channel construction and layout of the overseas component market. The single-crystal penetration at the wafer end is obvious, and the market demand is hot. As a single-crystal leader, the company is expected to continue to absorb the high photovoltaic business cycle and high performance growth is expected. Profit forecast and investment recommendationsThe EPS in 2021 will be 1.32 yuan, 1.72 yuan, 2.27 yuan, corresponding to 17 for PE.3 times, 13.3 times, 10.1 times.Maintain the company’s “Buy” rating. Risk warning: The photovoltaic market is less than expected; capacity release is less than expected.