Huayu Automotive (600741): The performance is in line with expectations and the estimates are relatively low
Key Investment Events: Recently, the company announced a quarterly report, with revenue of 355 in Q1 2019.
700 million, down 11.
6%, return to the mother’s profit 18.
500 million, down 36.
6%, deducting non-profit 13.
600 million, down 15.
1%, gross margin of 14.
3%, an increase of 1.
2pct, net interest rate 6.
6%, down 2.
The domestic passenger car production in Q1 2019 was 522.
70,000, downgraded to 12.
4%, SAIC Group produces 152.
50,000 vehicles, down 18.
Company revenue fell by 11.
6%, better than domestic and major customers, mainly due to the relatively stable overseas auto market.
Revenue by product, 2019Q1 internal and external decoration revenue 261.
300 million, down 3.
1%, metal business 29.
700 million, down 13.
1%, functional pieces 74.
4 billion, downgraded by 20.
7%, electronics 13.
100 million, down 17.
0%, hot working 2.
0 billion, down 24.
8%, the average revenue of each business, the growth rate varies due to the differences in the domestic and foreign customer structure of each business.
The gross profit margin increased due to the decrease in revenue of the metal business with the lowest gross profit margin.
Investment income from joint ventures 7.
900 million, down 23.
1%, net profit attributable to the parent’s profit, mainly due to the company’s confirmation of a one-time premium of 50% for the acquisition of Huayu Vision in the first quarter of 2018.
The expense ratio has increased.
2019Q1 sales expense ratio 1.
4%, flat for one year, and management expense ratio of 5.
4%, an increase of 0.5pct, R & D expense ratio 3.
6%, an increase of 1.
1pct, financial expense ratio is 0, increase by 0 in ten years.
2pct, period expense rate is 10.
4%, an increase of 1.
8pct, the cost is relatively rigid, and the decrease in revenue leads to an increase in the expense ratio.
The performance is in line with expectations, and electric intelligent progress is leading.
Since 2018, the industry and the company have entered an adjustment phase. We should maintain reasonable expectations for the company’s short-term growth and profitability.
However, the company’s overall layout of the core technology of electric intelligence and leading mass production, we are optimistic about the company’s long-term competitiveness, and currently expect the horizontal and previous comparisons are relatively low.
The company’s EPS for 2019-2021 is expected to be 2.
79 yuan, maintaining the “prudent increase” rating.
Risk reminder: auto sales increase sharply, overseas factories operate poorly