Jidong Cement (000401)： Q1’s strong turnaround, infrastructure elasticity boosts gradual profit
Jidong Cement (000401): Q1’s strong turnaround, infrastructure elasticity boosts gradual profit
Event: On April 23, the company announced the 2019 Q1 report.
The company achieved operating income of 50 in Q1 2019.
08 million yuan, an annual increase of 47.
74%; net profit attributable to mother is 0.
4.5 billion, an increase of 107 every year.
72%; net profit after deduction is 0.
29 ppm, an increase of 105 per year.
With the recovery of regional demand, the company’s comprehensive sales of cement and clinker in the first quarter of 2019 were approximately 1,415 tons, an increase of approximately 350 tons compared to the same period last year.
Benefiting from the recovery of infrastructure and the rapid growth of real estate construction and construction, cement demand in Beijing-Tianjin-Hebei region in 2019Q1 is picking up, driving the company’s cement sales.
The gross profit per ton in 2019Q1 is about 117 yuan, which has increased sharply by 33 yuan throughout the year.
Due to the good demand side, strong contraction force at the supply side, and enhanced market control capabilities after the Jidong Jinyu regional integration, the regional cement price center in the first quarter of 2019 only increased significantly.
From the company’s data, the company’s ton cement price in 2019Q1 was 354 yuan, compared with 318 yuan in the same period last year; the cost of 2019Q1 ton was 237 yuan, which increased slightly by 3 yuan; the gross profit of the company’s ton in 2019Q1 was 117 yuan, compared with 84 yuan in the same period last year.Each went up 33 yuan.
With the increase in profits of joint ventures in this period, the company’s investment income in 2019Q1 was 45.04 million yuan, compared with -42.95 million yuan in the same period last year.
Due to the increase of the holders’ shares in China Reinsurance Co., the fair value gains in the first quarter of 2019 were 9.72 million yuan.
Investment suggestion: demand side. Looking ahead to 2019, we believe that the cement in the Beijing-Tianjin-Hebei region is expected to benefit from the recovery of infrastructure and drive the overall cement demand to resume growth. The prosperity is conducive to continuation.
Since the beginning of 2019, the gradual easing of funds and the restoration of credit environment have provided a good environment for the development of infrastructure, which has accelerated the issuance of special bonds issued by local governments. We believe that infrastructure will gradually pick up in 2019. Against the backdrop of the real estate down cycle, demand for cementCreate better hedges.
Beijing-Tianjin-Hebei integration is also a key focus of government infrastructure. Jidong Cement directly benefits as a regional leader.
On the 成都桑拿网 supply side, the overall supply in the Beijing-Tianjin-Hebei region has not increased significantly, the regional inventory game layout has continued, and the supply constraint intensity of the main cement production areas headed by Tangshan under the constraints of environmental protection has maintained regional cement prosperity.
Under the pressure of environmental protection, Tangshan City issued the “Peak-shift Production Plan for the Second and Third Quarters of 2019 in Key Industries”, which requires cement companies to suspend production in turns from April to September.
After the merger of Jidong and Jinye, the regional concentration has greatly increased, which is expected to strengthen the regional cement market control.
After the cement asset integration of Jidong and Jinye is completed, the regional duopoly will become a single oligopoly, and the regional pricing power will be further enhanced.
According to data from Digital Cement Network, the production capacity of Jidong Cement and Jinye Group in Beijing-Tianjin-Hebei is 28% and 29% respectively. The combined new company ‘s production capacity in Beijing-Tianjin-Hebei will reach 57%.The right to speak has been significantly improved, which is conducive to maintaining a high regional cement boom.
Based on the demand for regional infrastructure recovery in 2019 and the merger of Jidong and Jinyu, the concentration in the region has increased greatly. We believe that the company’s net profit attributable to mothers in 2019 and 2020 will be 25.
10,000 yuan, given an “overweight” rating.
Risk Warning: 1.
Macroeconomic risks 2.
Supply-side reforms fall short of expectations