Xingyu Co., Ltd. (601799): Inflection point of gross profit margin upward trend clear performance continued high growth

Xingyu Co., Ltd. (601799): Inflection point of gross profit margin upward trend clear performance continued high growth

The growth of the first quarter results accelerated, in line with our previous expectations.

The company released its financial report for the first quarter of 2019, and achieved operating income of 14 in the first quarter.

24 ppm, an increase of 21 in ten years.

21%, an increase of 13.3% over the fourth quarter of last year
.

06 averages, an increase of 1 from last year’s average.

97 units; net profit attributable to mother 1.

700,000 yuan, an increase of 30 in ten years.

15%, an increase of 13 over the fourth quarter of last year.

17 averages, an increase of 0 compared to the same period last year.杭州桑拿养生会所

24 units; gross profit margin 23.

28%, an annual increase of 2.

18 averages, a decrease of 2 from the fourth quarter of last year.

58 averages (up from last year’s average of 0.

72 units); net interest rate 11.

94%, an annual increase of 0.

81 averages, a decrease of 0 from the fourth quarter of last year.

59 averages (down from the same period last year.

05 averages).

The overall performance showed an accelerating trend, in line with our emerging expectations.

Under the condition that the overall prosperity of the automotive industry is still poor, the company’s performance against the trend has achieved a much faster growth than the industry, mainly due to: (1) product upgrades: car lights products are fully upgraded along three paths, are ushered inThe favorable situation of rising volume and price and the turning point of gross profit margin; (2) Customer optimization: The customer structure is changing from independent brands to joint venture brands, and benefiting from FAW-Volkswagen’s new car cycle, product demand has grown rapidly; (3) Release:The new factories in Changzhou, Foshan and Changchun have been put into operation successively, and the production capacity has continued to increase.

Product upgrades have brought about a favorable situation in which both volume and price are rising and the gross profit margin turning point is upward.

The company’s car light products are upgraded along the “headlight + LED + intelligent” path, and the average price of single lamps in 2019Q1 increased (from small lights to headlights, halogen lights to LED lights, ordinary lights to smart lights, withThe value of single lamps has increased rapidly), the upward trend of the gross profit margin turning point continues (LED headlights gross profit margin exceeds the preset upper limit headlamps, the proportion of reduction in portable LED headlights increases, and the gross profit margin of the automotive lamp business is gradually increasing).

The product yield improvement brought by the climbing of headlamp capacity and the gradual mass production of future intelligent car lamp products (AFS, ADB headlamps), the favorable situation of the company’s car lamp business volume and price rising and gross profit margin turning point is expected to continue.

Benefiting from FAW-Volkswagen’s new car cycle, product demand is expected to maintain rapid growth.

In recent years, the company’s customer structure has continued to optimize from self-owned brand car companies (Chery and others) to joint venture brand leading car companies (FAW-Volkswagen, SAIC-Volkswagen, etc.).

At present, the company’s largest customer, FAW-Volkswagen, is in a new round of product cycle.

According to the Pacific Automotive Network, in 2019, FAW-Volkswagen’s three major brands (Volkswagen, Audi and the new brand) are expected to launch 28 new cars.

Under the new car cycle, FAW-Volkswagen’s demand for its lamp products is expected to further increase.

The initial release of production capacity guarantees the company’s future performance growth.

The company continues to expand its production capacity in Changzhou, Foshan and Changchun. In 2018, the first phase of the Foshan factory has been completed and put into operation. The second phase of the project is under construction and is expected to be completed in the second quarter of 2019.It is also expected to be completed in 2019.

The steady increase of production capacity will provide strength guarantee for the company’s future performance growth.

Investment suggestion: The company’s first-quarter performance in 2019 is in line with our expectations. Under the three driving forces of “product upgrade, customer optimization, and capacity release”, the long-term growth trend is good.

We forecast the company’s full-year earnings from 2019 to 2021 to be 2.

98 yuan, 3.

79 yuan and 4.

68 yuan, return on net assets were 17 respectively.

1%, 19.
5% and 21.
5%.

Maintain “Buy-A” investment rating.

Risk Warning: The growth of the expansion of LED car lights is less than expected; the sales volume of downstream customers 爱北京体验网is less than expected; the production capacity of the new plant is less than expected.