Conch Cement (600585): Profit hits record high and faucet continues to expand

Note: Unless otherwise specified, the currency unit here is converted into RMB.

  The company’s 2018 revenue was 1284.

03 billion, previously +70.

5%; net profit attributable to mother 298.

14 trillion, +88 a year.

05%; net profit after deduction is +111.

81% may send out a golden bonus of 1.

69 yuan.

  The trading 苏州桑拿网 platform helped promote the rapid increase of market share. The self-produced and sales volume was affected by the environmental protection error peak: the company’s comprehensive sales volume of cement clinker in 20183.

68 billion tons, a sharp increase previously24.

77%, far faster than the industry growth rate, of which the sales volume of the trading platform is about 7,000 euros, which has increased 12 times every ten years, which has helped the company to expand and increase rapidly, showing the company’s market share and control as a leader; in addition, its own production and sales volume2.

9.8 billion tons, an increase of 2 in ten years.

69%, slightly lower than the national cement output growth rate of 3% in 2018, which was mainly affected by the core and core markets of East China last year. Environmental impact 返回码: 500 网站打不开?重查 peaks and restrictions on production were severely affected. We estimate that the company ‘s self-production and sales of Q4 can only be slightly reduced (last yearIn November and December, the monthly output of cement in Anhui Province was -7 per second.

34%, -4.


  Multiple favorable factors resonate, and the profit hits a record high: the company’s self-products ton revenue in 2018 was about 328 yuan, an increase of 81 yuan, of which Q4 ton revenue reached about 364 yuan, a substantial increase of about 37 yuan, mainly due to the peak season demandNew start-ups are pulling ahead of expectations, overlapping the environmental protection peaks of the Yangtze River Delta in autumn and winter, overcoming the supply of energy-saving and power-restriction, multiple favorable factors resonate, and pushing prices in East China to a record high.

The company’s profit has therefore reached the best level in history. In 2018, the gross profit per ton of self-products was about 154 yuan, which was increased by about 66 yuan each time. Among them, the gross profit was estimated to be about 180 yuan in Q4 tons.103 yuan, an increase of about 50 yuan per year.

  Cash cows with continuously optimized capital structure, expanding internally and externally to maintain expansion: In 2018, the company’s net operating cash flow was 360.

59 billion, an increase of 107 previously.

68%; cash in hand at the end of the period was 37.6 billion, interest-bearing debt was only 13.5 billion, and the asset-liability ratio continued to fall to 22.

15%; financial expenses turned negative to -4.

7.4 billion; abundant cash flow also lays the foundation for the company’s internal and external expansion of the continuous expansion. It reports that the merged company acquired Guangying Cement, overseas projects continue to progress in an orderly manner, and aggressively expand the aggregate business; the company plans to have capital in 2019Expenditure is about 10 billion yuan. It is expected to increase cement production capacity by about 400 replacements (excluding M & A) and aggregate production capacity at 1,700.

As there are still too many positive expansion expectations, the company’s dividend rate for 2018 is 30.

04% has fallen, but the dividend yield is still close to 4 at the latest closing price.


  Investment suggestion: The company has obvious advantages as a leader, leading the industry in profit, and maintaining continuous expansion through internal and external expansion; and industry demand can still be transformed, and the supply layout is good. The company’s EPS is expected to be 5 in 2019-2021.



79 yuan, corresponding to the latest closing price of PE respectively 6.



21 times, PB is 1.



15 times; based on historical estimates over the past three years (average PB1.

62 times), considering the company’s ROE profit center moved up in the past three years, giving the company 1.

85 times PB, quantified net assets in 201924.

63 yuan, corresponding to a reasonable value of 45.55 yuan / share; the latest closing price of H shares is 5 relative to A shares.

27% premium, so based on the current A and H share premium ratio and exchange rate calculation, the reasonable value of H shares is 56.

09 made / share.

Maintain “Buy” rating on A and H shares.

  Risk warning: demand worsens severely, the industry’s supplementary supply exceeds expectations, and collaborative shutdowns rupture