Valin Steel (000932) 2018 Annual Report Comment: Balance Sheet Remarkably Repairs Offensive and Defensive Both New Position

Valin Steel (000932) 2018 Annual Report Comment: Balance Sheet Remarkably Repairs Offensive and Defensive Both New Position

Matters: The company’s 2018 annual report officially disclosed that its total operating income was 913.

69 trillion, a year ago 19.

11%, with a net profit of 67.

800 million, 64 a year ago.

53%, the basic EPS is 2.

25 yuan, the average ROE is 48.

64%, 10 to 4 shares.

Comment: Production status: In 2018, the company put into production 1,836 millimeters of steel (at least +170 millimeters); following the increase in steel output in 2017 of 177 tons, the company’s output continued to climb sharply, and the production capacity continued to increase.

The obvious increase in volume reduces the fixed costs, depreciation and amortization, labor costs, etc. that are amortized to the unit steel, while the robe reduces the unit cost, increases the profit per ton of steel, and has the effect of increasing both volume and profit.

Comprehensively considering the situation since the supply-side reform, the company is the company with the largest capacity increase among the largest listed steel companies.

It is precisely 苏州桑拿网 because the company invested a large amount of capital expenditure to complete the modernization of equipment during 2009-2011, so it has not been affected by the elimination of backward production capacity.

At the same time, the newly built high-end production line of the company needs to introduce a break-in period, and the industry that has been constrained by funds has been poor to replace production.

After three years of profit restoration, the company’s production status and other conditions have significantly improved, and the company’s qualifications have changed.

In the first quarter of 2019, the company’s monthly output continued to rise. In January 19, the monthly steel production of 170 broke through a new high. The first quarter performance is worth looking forward to.

Gross profit: In 2018, the company’s gross profit per ton of steel was 876 yuan (+233 yuan month-on-month), of which the gross profit per ton of steel in the fourth quarter was 790 yuan (money-217 yuan).

The estimated gross profit per ton of rebar in the five quarters of 2018Q1-2019Q1 was 811 yuan, 907 yuan, 994 yuan, 790 yuan, and 433 yuan; the estimated gross profit of hot-rolled ton steel was 748 yuan, 892 yuan, 740 yuan, and 346 yuan, respectively.And 331 yuan; the estimated gross profit of the middle board is 585 yuan, 909 yuan, 702 yuan, 351 yuan and 280 yuan.

The company’s plate business accounted for half of the revenue. In the fourth quarter of 2018, the plate’s estimated gross profit position was the most serious, and the main plate of Xianggang was the subsidiary with the highest shareholding in listed companies, so the company’s fourth-quarter performance was poor.

However, from the perspective of the performance of various varieties in the first quarter, hot rolling has shown a certain effect.

Asset structure: The asset-debt ratio continues to decline, and the debt structure continues to optimize.

In the 2018 annual report, the company’s asset-liability ratio was 65%, which was extended by at least 15% a year, the lowest level in recent years.

In terms of the absolute value of debt, the company’s long-term borrowing + short-term debt was 18.9 billion, a reduction of at least 7.4 billion.

From the perspective of debt structure, the proportion of the company’s long-term debt in debt reached 33%, an increase of 20%, avoiding the contradiction of short-term expenditures and difficult turnover.

In terms of financial expenses, the company’s financial expenses for 2018 were 15.

38 trillion, a reduction of 3 trillion.

The balance sheet has been significantly repaired, and in the past, the disruption caused by financial problems to the company’s operations has basically disappeared.

Other expenses such as three expenses: the company’s loss improved financial expenses reduced by 300 million US dollars, and the increase in employee wages and R & D expenses led to an increase in management expenses8.

50,000 yuan, the increase in production and marketing management costs increased by 4.

4 billion yuan, the three fees have increased by nearly 10 billion in total.

In 2018, the main subsidiaries of the company, Xiangshan Iron and Steel, Lianyang Iron and Steel, and Hengshan Iron and Steel, have gradually used up the deductible, and the revenue and expenses increased by 700 million yuan.

In addition to the auto plate company in 19, all need to pay 15% of insulin.

In the previous market, it was easier to pay attention to understanding Valin as a flexible target for performance increase period allocation, but we believe that after three years of profit improvement, the company’s balance sheet has been significantly repaired and the efficiency of production and operation activities has also been greatly improved.

At present, Valin is an excellent target with both offense and defense.

The company’s varieties of plates are mainly mechanical ship spindle plates, etc., which are the types that mainly benefit from infrastructure construction.

Seamless pipes are also a category with improved profit in the first quarter. The comprehensive company ‘s output in March hit a new high. We think that the company ‘s first quarter report may be more prominent among mainstream steel companies.

Earnings forecasts, estimates and investment ratings.

We estimate the company’s main business income for 2019-2021 to be 951.


37/989.22 trillion (previous forecast was 996 for 2019-2020).


410,000 yuan), corresponding to the return to the mother’s net profit was 56.



8.6 billion (previous forecast was 92 for 2019-2020).


7.3 billion), the corresponding EPS is 1.



08 trillion (previous forecast was 3 for 2019-2020).


61 yuan), the corresponding PE is 4/4/4 times.

The company’s return to mother’s net profit in 2019 is expected to be 57 trillion, combined with an industry assessment level of 5 times, and the corresponding target price is 9.

43 yuan.

The company’s main varieties of hot-rolled plates and steel pipes are better-performing varieties this year, and the grades have been raised to “strong push”.

Risk warning: Iron ore is eroding profits of steel mills, and demand is less than expected.