Depth-Company-Hengli Hydraulics (601100): Cycle + Growth Resonance Gradually Becomes Continuously High Growth

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Depth-Company-Hengli Hydraulics (601100): Cycle + Growth Resonance Gradually Becomes Continuously High Growth

Category : 洗浴

Depth * Company * Hengli Hydraulic (601100): Cycle + Growth Resonance Gradually Achieve Continuous High Growth

With the gradual fulfillment of the expected increase in infrastructure, the prosperity of the construction machinery industry is expected to continue.

The main products of Hengli Hydraulics are excavator cylinders and pump valves. At present, production is fully scheduled, and it is expected to maintain full production and sales, verifying that the downstream prosperity is still high.

Looking ahead, while the company’s revenue is growing, its profit growth rate is more worthy of attention.

The company’s ability to control costs has been further improved, and the net interest rate has continued to rise, or it may become the main supporting logic for the performance exceeding expectations in 2019.

Based on the performance forecast, we raise the company’s profit forecast, maintain the Buy rating, and recommend it.

The support level of the cycle + growth, the company fully benefited from the strong recovery cycle of construction machinery.

The company’s main products include excavator cylinders and pump valves, fully benefiting from the strong recovery of downstream excavator sales in this round.

According to statistics from the Construction Machinery Association, domestic excavator sales reached 20 in 2018.

340,000 units, a year-on-year increase of 45%, far exceeding the record high of 17 in 2011.

Sales record of 840,000 units.

The total sales volume of excavator cylinders of our injection molding company in 2018 reached about 480,000 pieces, and the market share has increased to about 60%.

With the release of production capacity, pump and valve products have shown a doubling trend. It is expected that the company’s small-dig pump valve products will have a market share of about 30%, and medium-dig and large-dig pump valves will be the performance growth points of 2019-2020.

The production of oil cylinders + pumps and valves is saturated, and it is verified that the prosperity of downstream engineering machinery continues.

Considering the sales volume and market share of excavators in January, we predict that the company’s sales volume of excavator cylinders in January will reach 44,000-45,000, an increase of about 35%.

The company has plenty of orders in hand to ensure that it can maintain full production and sales in February-March.

The company’s cylinder delivery cycle is 45-60 days. Each time it responds from the 四川耍耍网 supply side, downstream OEMs remain optimistic about sales in March-April, verifying that the downstream boom is continuing.

The cost control ability is prominent, and the net interest rate is increasing rapidly.

Looking forward to 2019, we judge that while the company’s revenue is growing, its profit growth will scale, and the level of profitability will increase or become one of the performance growth points.

The company’s cost control ability is prominent, and the gross profit margin and net profit margin are increased, which mainly include: 1) scale effects, the continuous release of pump valve product throughput, the contribution and contribution doubled, while the production line cost is relatively compressed; 2) product structure adjustment; especiallyIt is a non-standard oil cylinder. Since 2018, the company has 武汉桑拿社 adjusted the product structure, increased the price of some products, and raised the gross profit margin to about 35%; 3) Process improvement, through the adjustment of production line equipment (including a small increase in some equipment) to achieve the processThe purpose of improving and increasing production capacity is to increase productivity.

We expect that the net profit margin of the company’s pump and valve products is expected to increase to about 20% in 2019, and the net profit margin of the cylinder products will be higher.

The main risks faced by the rating are the growth rate of infrastructure investment, and the sales of excavators have fallen sharply.

It is estimated that based on the company’s forecast and the latest changes in industry fundamentals, we raise the company’s net profit forecast for 18/19/20 to 8.



9 trillion, corresponding to 18/19/20 PE is estimated to be 29/19/18 times. Maintain BUY rating and continue to recommend.