Wanhua Chemical (600309): Analysis of the Growth of New Materials
We believe that the new materials business is the most important aspect of Wanhua’s future. Through analysis of Wanhua’s own accumulation, correlation and industry development trends, we believe that Wanhua’s new materials business will enter a rapid growth period.
The core point of view is the rapid accumulation of its own reserves: Wanhua and overseas leader rankings are still in the catch-up period. The advantage of the catch-up period is that the success rate of R & D yields is higher.
Wanhua has continued to invest in research and development for a long time, and from 16 years on, both the research and development costs, the number of patent applications, and the proportion of patents representing materials in the future, such as materials, coatings, special chemicals and functional chemicals, are rapidly increasing.
At the same time, Wanhua’s sales department has been further strengthened at the same time. Therefore, we believe that Wanhua’s large investment in technology and marketing will enable Wanhua to get closer to overseas participation more quickly.
The industrial foundation is gradually complete: Wanhua has gradually completed the supporting of basic chemical products through investment in petrochemical projects in recent years.
Unlike the market, which is more concerned about the profitability of the project, we believe that the significance of Wanhua’s construction of petrochemical projects is to provide the necessary conditions for the high-end development of Wanhua’s new materials, which is also the common connection of overseas leading new materials companies.
And through comparative analysis, the overall cost of polishing Wanhua can be far lower than that of overseas leading companies, which has built a strong cost advantage for future alternative competition in the field of new materials.
The period of development potential is coming: due to the weakening global demand, the general growth rate of various fields such as automobiles has decreased or even decreased. Although the overall disadvantage is not good for the chemical industry, we believe that the poor macro environment will make the downstream supply chain more open, which has obviousThe cost competitiveness of Wanhua will increase.
At the same time, during the downturn of the industry, it is easier for overseas competitors to choose shrinking measures such as layoffs, reduce expenses, and split assets. The accompanying 成都桑拿网 loss of customers and staff layoffs easily become development opportunities for aggressive enterprises like Wanhua.
Financial Forecast and Investment Suggestions We forecast the company’s total EPS to be 3 in 19-21.
60 and 4.
24 yuan, according to the company’s 19 times 19 times price-earnings ratio, raise the target price to 53.
23 yuan (origin target price 49.
20 yuan), maintain BUY rating.
Risks prompt macroeconomic risks, risks of crude oil price fluctuations, risks of new project progress, breakthroughs in MDI industry barriers