Aerospace Electric (002025): Q3 performance growth is slightly lower than expected Civilian business gradually opens up the company’s growth space

Aerospace Electric (002025): Q3 performance growth is slightly lower than expected Civilian business gradually opens up the company’s growth space
1.The event company released 2019 third quarter report with revenue of 25.12 ppm, an increase of 28 in ten years.11%, net profit attributable to mother 2.97 ppm, an increase of 11 years.34%, net of non-attributed net profit2.81 ppm, an increase of 10 in ten years.81%, EPS is 0.69 yuan. 2.Our Analysis and Judgment (I) The growth rate of performance exceeded expectations, and the expected performance continued to grow slowly in the first three quarters of 2019. The company’s operating income and net profit attributable to mothers may increase by 28 respectively.11%, 11.34%, revenue growth basically in line with expectations, the acceleration of net profit growth attributable to mothers has improved, Q3 single-quarter net profit almost no growth, slightly lower than expected.Investigating the reasons, we believe that: First of all, in order to meet the needs of future new business growth, the company’s R & D expenses increased by 28 in the first three quarters.59%; Secondly, the proportion of relative income of civilian products increased relative to the level of profit, and the overall gross profit margin decreased by 2.42pct; again, due to the increase in accounts receivable, the corresponding increase in bad debt provisions, the company’s asset impairment loss was 8539.10,000 yuan (+40 for one year.54%). Looking at the forward-looking indicators, the company’s inventory increased by 40 earlier.60%, an annual increase of 17.16%, reflecting the company’s better orders, in order to ensure timely delivery of products, a moderate increase in material reserves.As the company’s payment 苏州夜网论坛 collection is mainly concentrated in the fourth quarter, according to historical data, we believe that the probability of continuous asset impairment losses will increase, and the company’s performance will grow steadily. (2) In line with the national development strategy, the civilian products gradually open up the growth space. The company belongs to the electronic component manufacturing industry, and the state focuses on supporting the development of new electronic components, which restricts the development space of the industry.Benefiting from the steady growth in demand from key national development industries such as communications, big data, and rail transit, the company’s civilian business scale and sustainable, sustainable and stable growth. In March 2019, the company established a joint venture with Dongguan Yangming, Guangdong Huajing, which consolidated its balance sheet. Relying on its own advantages in technology, brand and marketing channels, combined with Dongguan Yangming Precision Mould and precision parts manufacturing capabilities, it will create a civilian connector development and production base and expand the company’s civilian product business development space.While accelerating the industrial layout of the Pearl River Delta region, it will also break through the foundation to seize the possibility of 5G construction in the future, expand the industrial scale, and enhance the company’s profitability. (3) With respect to the military products that are backed by the Science and Industry Group, the military product has a stable market demand. Over 70% of the company’s products are sold to high-end customers in the fields of aerospace, aviation, electronics, ships, weapons, etc., which basically covers the entire military equipment field. And the company is backed by the Aerospace Science and Industry Group and has been cultivating in the military industry for many years. It has high-tech barriers and stable customer resources.In the short term, the company will benefit from the gradual elimination of the effects of military reform and the increasing demand for practical training; in the medium and long term, the level of informationization of national defense equipment will continue to increase, the pace of domestic substitution will accelerate, and the demand for high-end electronic components will continue to increase.Benefiting from this, we can expect continued performance growth. 3.The investment proposal estimates that the company’s net profit attributable to the parent from 2019 to 2021 will be 4 respectively.24 billion, 5.1.7 billion and 6.2.3 billion, EPS is 0.99 yuan, 1.21 yuan and 1.45 yuan, currently corresponding to the corresponding PE is 25x, 21x and 17x. With reference to comparable companies in the industry, the company’s estimated advantages are obvious, the civilian product market is strong, continuous growth is expected, and the recommendation rating is maintained. Risk Warning: The progress of military product procurement is less than expected, and the risk of intensified competition in civilian products