Depth * Company * Huazheng New Material (603186): Additional issuance of new capacity to meet 5G commercial use
The company is a leading domestic manufacturer of copper-clad laminates, with high and high-speed copper-clad laminate production capacity, and some of its products have been certified by well-known end customers such as Huawei.
At present, the company is planning to issue additional issues to reserve new capacity for 5G applications.
With 佛山桑拿网the scale construction of 5G network, the company’s copper-clad laminate business will enter a growth period, covering for the first time, and given an “overweight” rating.
Key points of support levels The price of ordinary copper clad laminates has gradually stabilized.
The company is a leading domestic manufacturer of copper-clad laminates. Its main products include copper-clad laminates, thermoplastic materials, and thermoplastic honeycomb panels. Among them, the revenue of copper-clad laminates accounts for about 80%.
In 2018, due to the downward impact of the price of ordinary copper-clad laminates, the company’s gross profit margin for copper-clad laminate products decreased2.
There are 72 singles. At present, the price of ordinary copper clad laminates has come out of the downward trend, and the company’s ordinary board products have improved profitability.
Deploy high-speed boards ahead of time to welcome 5G.
As early as 2016, the company’s Qingshan Lake 4.5 million square meters copper clad laminate project was immediately established. In 2018, the first phase of the Qingshan Lake base project was completed and put into production. At present, it is basically in full production, but it is mainly based on ordinary copper clad laminate products.
With the scale construction of 5G networks, the company’s Qingshan Lake base capacity will gradually shift to high-speed boards, and the overall gross profit margin level of copper clad laminate products will gradually increase.
The additional issuance of new production capacity contributed to increase the elasticity of performance growth.
In the field of high-frequency boards, the company actively carries out product development and customer introduction.
In April 2019, the company announced an additional issuance plan, which plans to issue no more than 6 funds.
US $ 500 million for the second-phase project of Qingshan Lake Manufacturing Base with an annual output of 6.5 million square meters of high-frequency high-speed copper-clad laminates and supplementary working capital
The second-stage project will contribute value to the company’s performance flexibility.
Estimated expected company 2019?
The EPS in 2021 is 0.
56 yuan, the current expected corresponding PE is 35X, 26X, 19X.
Considering the pulling of the demand for high-frequency and high-speed boards by 5G construction, it will cover for the first time and be given an “overweight” rating.
The main risks facing rating 5G construction progress is less than expected; new product customer introduction is less than expected.