Seiko Steel Structure (600496): EPC conversion volume can be expected with sustained high growth performance
The median growth rate of profit is expected to be slightly higher than expected. Maintaining a “Buy” rating company released a 19-year performance forecast on the evening of January 15th. It is expected to realize net profit attributable to mothers in 19 years.8-4.2 billion, an annual increase of 109% -131%, of which non-recurring gains and losses are about 5200 million, and the net profit growth rate of non-returned mothers is expected to be 115% -141%, and the median profit growth rate of the company slightly exceeds the market and our expectations. We believe that the steel structure industry is booming, the company has full contracts in hand, the order structure has improved, new business development volume can be expected, and performance has maintained high growth.EPS 0 is expected in 19-21.22/0.30/0.35 yuan, target price 3.90-4.20 yuan, maintain “Buy” rating. The order structure has been improved, and the heavy volume of the EPC model can be expected. According to the 19-year operating briefing, the company has a new single 140 in 19 years.4 billion, an increase of 14 in ten years.5%, of which the public / industrial building single-digit increase of 84 in the new decade.7% / 14.1%, commercial buildings are basically the same as in 18 years.New orders of over 100 million yuan were signed in 1961.2 billion, an annual increase of 29.6%, of which public / industrial / commercial construction orders over 100 million yuan growth rate were 143.4% / 19.3% / 10%. The high growth of public construction orders is mainly due to the company’s conversion from traditional professional subcontracting to EPC general contracting, and the role of “Party B’s Party B” to “Party B’s Party A” has been changed, which has led to the increase in order scale and project profitability.Industrial buildings are positioned in emerging industries, and customers are gradually changing from traditional construction machinery and tire industries to emerging industries such as logistics and warehousing, and automotive new energy. The high growth of large orders has driven the company’s order structure to improve. The prefabricated construction business has leading technology, high assembly rate, and higher reproducibility. On January 13, the company announced that the subsidiary’s green building “theory of high-rise steel-concrete mixed structure theory, technology and engineering application” project won the National Science and Technology Progress Award.The first prize is the sixth time that the company has obtained national scientific and technological achievements, demonstrating the technological leadership in the field of fabricated buildings.Since 2010, the company has begun to develop prefabricated buildings. At present, it has formed five major product systems of residences, apartments, schools, hospitals, and office buildings, with an assembly rate of 95%.In addition, the company will transfer core technology licenses to traditional 北京桑拿洗浴保健 general contracting enterprises that have the needs of upgrading the assembled construction industry. The partners will hold a joint venture and Seiko will jointly build an industrial base. The company will make profits through partner resource fees and cloud client fees.Through the company’s technology, brand and management output increase the city’s share in an asset-light manner, and the model is highly operable and highly replicable. The industry is booming, and the penetration rate of steel structure housing is expected to accelerate into 2019. The steel structure housing related policies have been strengthened. In March, the Ministry of Housing and Urban-Rural Development of the People’s Republic of China first proposed to promote the trial of steel structure housing.The first meeting of the working meeting of the Ministry of Housing and Urban-Rural Development in December 2020 vigorously promoted the pilot construction of prefabricated residential buildings with steel structures. The mission objectives were further refined. According to the data of China Construction Metal and Steel Structure Association, the penetration rate of residential steel structures in the country is currently about 1%, and the subsequent penetration rate will increaseSpace penetration (some provinces have a target penetration rate of 10% by 2022). Through the increase in assembly rate, the PC single flat cost increases faster. Under the background of increasing the assembly rate environment, the advantages of steel structures are expected to gradually appear, and the penetration rate in the residential sectorPromotion is expected to accelerate. Performance progress continued to grow at a high rate. We maintained the “Buy” rating as a traditional steel structure leader. The company’s performance continued to grow at a high rate. We maintain the company’s EPS of 19-21.22/0.30/0.35 yuan, 20FY average PE 13 for comparable companies.29X, considering the improvement of the company’s profitability and the inclusion of the high prosperity of the steel structure industry, we recognize that the company will be given 13X-14XPE for 20 years, corresponding to a target price of 3.90-4.20 yuan, maintain “Buy” rating. Risk warning: The technology licensing business expansion is less than expected, and the execution of orders on hand is less than expected.