Bayi Iron and Steel (600581): The development of infrastructure in Xinjiang remains to be seen
Performance summary: The company released the 2018 annual report today, and achieved operating income of 201.
10,000 yuan, an increase of 20 in ten years.
0%; realize net profit attributable to shareholders of listed companies.
0 ‰, a decrease of 40 per year.
The initial EPS is 0.
46 yuan, single quarter EPS are 0.
09 yuan, 0.
05 yuan, 0.
24 yuan and 0.
08 yuan; ton 杭州桑拿网 steel data: the company’s crude steel in 2018, the steel output was 561 vertical, 523 leads, each year increased by 8.
Combined with the annual report data, the ton steel ton is 3481 yuan / ton, the ton steel cost is 3015 yuan / ton, the ton steel gross profit is 466 yuan / ton, each increase by 294 yuan / ton, 280 yuan / ton and 14 yuan / ton; infrastructure in the territoryThe initial merger of environmental protection factors led to a decline in profitability: Against the background of tight fiscal policies in 2018, domestic infrastructure construction investment increased significantly. Among them, Xinjiang, a major province in the western region, is more affected by the closed regional environment.
Affected by the inventory PPP project, long-term investment in fixed assets within the territory has fallen sharply25.
2%, demand for steel was suppressed.
In the second half of the year, the government’s macroeconomic policies tended to relax, and construction projects started to improve.
However, for most of the year, Xinjiang rebar prices were significantly lower than those in the Mainland, and the supply and demand environment in the territory deteriorated significantly.
Combining the company’s budget data, the production and sales rate of the company’s building materials fell abnormally to 69% in the first quarter, and the production and sales rate in the next quarter gradually returned to normal levels.
The excess steel in Xinjiang was forced to flow out, and the two companies reported that their revenues outside Xinjiang reached 37.
1%, the highest value since 2009.
From the financial data point of view, the increase in sales expenses in 2018 increased significantly 87.
9%, mainly due to the company’s increase in sales outside the territory, freight and volume increased by some; in the cracks, because the deductible shortening has been completed, the second half of the year began to pay the payment and return to normal levels; taking into account the decline in inventory prices, etc.As a result, the provision for asset impairment will reduce the annual net profit attributable to the mother by RMB 36.03 million.
In addition, due to the impact of environmental protection and production restrictions, the suspension of production at multiple mines has led to high prices of raw materials such as iron ore, coking coal, and rising cost pressures, which have eroded profits to a certain extent. The development of infrastructure remains to be seen: counter-cyclical reductions in policy frequency since this yearWith the launch of the government, the government has expected a steady increase in investment in infrastructure construction, a gradual improvement in the credit environment and capital. Recent Xinjiang construction projects have been restored and rebuilt, and there has been a rebound in steel demand in the territory.
In addition, the company continued to deepen the adjustment of its product structure. In 2018, the proportion of board, model, and superior products in total sales increased from 59% in 2017 to 68%, and the impact of cyclical changes in the construction industry on the company’s earnings was reduced.
With the weakening of environmental protection and production restriction policies, the cost capacity caused by the shrinkage of raw materials is expected to improve.
The company issued an announcement on March 3 and decided to raise funds by itself2.
8.7 billion US dollars, investing in the construction of four environmental protection projects for ironmaking energy to meet the new environmental protection requirements, which is beneficial to the company’s long-term development; Investment recommendations: As a steel and iron leader in the territory, the company will be profitable in 2018 due to the fall in infrastructure investment and environmental factorsit has been improved.
As fiscal policy turns positive, infrastructure investment in Xinjiang has gradually stabilized, and there is a possibility of a rebound in steel demand in Xinjiang in the future.
At the same time, the company’s recent increase in environmental protection investment is conducive to long-term 北京夜生活网 development in a new form of environmental protection.
The company’s EPS for 2019-2021 is expected to be 0.
13 yuan, 0.
26 yuan and 0.
37 yuan, corresponding to PE of 38X, 19X and 13X respectively, maintaining the “overweight” level; risk warning: infrastructure investment is expected to recover, environmental protection policy risks.