Zhejiang Longsheng (600352) Semi-annual Report for 2019 Comment: Half-year Performance Records New Highs, Middle Business Creates Moat

Zhejiang Longsheng (600352) Semi-annual Report for 2019 Comment: Half-year Performance Records New Highs, Middle Business Creates Moat

Event: The company issued an announcement saying that the company’s net profit attributable to its mother was 25 in the first half of 2019.

32 ppm, an increase of 36 in ten years.

23%, of which the impact of non-recurring gains and losses is about 4.

8 billion.

The company’s single quarter profit hit a new high.

In the second quarter, the company’s net profit after deductions to non-returned mothers was 11 trillion, a year-on-year increase of 5%, the second highest quarter in history, second only to the company’s Q3 of 18

The company’s non-recurring gains and losses in the first half of the year included government subsidies.

2 trillion, mainly for the company’s old base demolition compensation.

The company’s gross profit margin was 47 in the first half of the year.

0%, an annual increase of 2.

7%, of which the gross profit margin in the second quarter was 49.

6% is the highest in 南京夜网 history.

The reason for the increase in the company’s gross profit margin was mainly due to the price increase of intermediate m-phenylenediamine due to permanent and permanent withdrawal, and the increase in the price of dyes for intermediate price increases.

Due to the obvious integration advantages, the company’s advantages are prominent in the case of fluctuations in the supply chain.

The dye sector increased in value and the middle sector performed well.

Due to the relocation of the company’s road relief plant, domestic dye production decreased by 28 in the first half of the year.

27%.

The company’s dye output in the second quarter of 19 was about 4.

4 nominal, the average unit price is about 4.

50,000 yuan; the output of dyes in the same period of 18 was 6.

2 Nominal, the average unit price is about 40,000 yuan.

Due to the volume reduction, the gross profit level of the domestic dyes sector of the company in 19H1 was basically unchanged from the same period last year.

In the first half of the year, due to a major safety accident at the loud water m-phenylenediamine manufacturer, supply was interrupted, and the supply and demand of m-phenylenediamine was difficult to change in the short term. Therefore, its average price increased from about 40,000 / ton to about 50,000 / ton.The gross profit of the company’s middle segment increased by 2 over the same period last year.

500 million, becoming a major performance increase.

The real estate business harvest period is approaching.

The company’s Huaxing New City project has obtained approval from the government for detailed adjustments to the detailed control plan.

It is expected that the Huangshan Road project will be able to deliver the house and confirm the revenue in recent years, and the Datong base can start pre-sale next year.

The company’s real estate business is approaching the harvest period. It is expected that the Huaxing New Town project will provide hundreds of millions of dollars of rental income every year after reinvesting costs, and the asset quality is excellent.

Company profit forecast and investment grade: We expect the company’s revenue in 2019-2021 to be 209.

23, 259.

12 and 362.

08 million yuan, net profit was 55.

04, 64.

05 and 77.

2.5 billion, with EPS of 1.

69, 1.

97 and 2.

37 yuan, corresponding to the current sustainable PE value of 8, 7 and 6 times respectively, maintaining the “strongly recommended” level. Risk Warning: Downstream Needs Less Than Expected, Real Estate Progress Than Expected