Dongmu (600114): Overweight MIM business technology platform attributes continue to strengthen the leading position of the industry

Dongmu (600114): Overweight MIM business technology platform attributes continue to strengthen the leading position of the industry

The event company issued an announcement on the evening of August 5, intending to use cash1.

9.98 million yuan acquired 61% equity of Dongguan Huajing Powder Metallurgy Co., Ltd.

Huawei is the largest customer of Dongguan Huajing, accounting for more than 65% of the company’s acquisition target, Dongguan Huajing, both financially and operationally dispersed and mature. It was a subsidiary of Jinsheng Intelligent (300083) and focused on powder metallurgy injection molding, The main products cover consumer electronics, medical, smart tools and other downstream areas, revenue from January to May 2019 exceeded 79 million yuan.

Dongguan Huajing’s comprehensive strength The first echelon of domestic MIM enterprises with strong comprehensive strength. It is also a rare enterprise with both MIM (metal powder injection molding) and CIM (ceramic powder injection molding) processing capabilities. The product line is long and high-end.

Huawei is the main customer of Dongguan Huajing. In 2018 and January-May 2019, Huajing directly and indirectly supplied Huawei mobile phone MIM structural parts, wearable device components, 5G routers and other products, which accounted for more than 65% of the placement.

Continue to expand downstream application scenarios, continue to enhance the advantages of technology platforms. As the absolute leader of domestic powder metallurgy companies, the company has been leading the industry in the development of new technologies and products, and has a large number of technical reserves including soft magnetics and MIM.

After entering soft magnetic materials in the early stage, the company has become one of the largest downstream soft magnetic suppliers in the domestic photovoltaic and communications industries.

The acquisition of the MIM business further complements the company’s powder metallurgy products and application scenario blueprint.

It can be expected that in the future, the company will further strengthen PM and soft magnetic faucet components and strategically develop MIM technology. At the same time, relying on the advantages of its own technology platform, it will continue to develop downstream application scenarios of powder metallurgy, integrated services electronics, communications, automotive, medical, tools, etcIndustry, leading level will also be further consolidated.

Profit forecast and investment advice: The company is a technology company with 深圳桑拿网 high barriers, full orders, and huge room for long-term growth.

The company’s performance improved in the second quarter, and the turning point was expected.

Taking into account the impact of Dongguan Huajing’s consolidation, we estimate that the company’s net profit attributable to its mother in 2019-2021 will be 2.

37 (-1.

91) / 3.

87 (-1.

82) / 4.

25 (-2.

22) Ten thousand yuan, EPS is 0.

37 (-0.

29) / 0.

60 (-0.

28) / 0.

66 (-0.

34) Yuan, the current sustainable corresponding PE for 2019-2021 is 16 respectively.

5, 10.

1 and 9.

2 times.

Maintain the “Highly Recommended” rating.

Risk reminder: the risk that the integration fails to meet the expectations; the actual return of the target company does not meet the expected risks.