Tongkun (601233): Steady growth in 18-year performance and 19-year recovery in demand favors midstream

Tongkun (601233): Steady growth in 18-year performance and 19-year recovery in demand favors midstream

The event company released its annual report, which achieved revenue of $ 41.6 billion in 2018, an increase of 26 per year.

78%, net profit attributable to mother 21.

20 ppm, an increase of 20 in ten years.

42% of the operating analysis benefited from the high prosperity of PTA and polyester, and the company’s performance increased. According to the company’s annual report, the net profit attributable to mothers in 2018 was 21.

20 ppm, an increase of 20% per year.

In the third quarter of 2019, it contributed most of its main results, and achieved net profit attributable to its mother in a single quarter.

42 trillion, a year-on-year increase of 117%, a month-on-year increase of 33%.

Company-scale product sales increased by more than 15%, with an average increase of 10?
16%, both volume and price rose.

The growth of the company’s performance mainly benefited from the high prosperity market of PTA and polyester and the release of new capacity of the company. The average PTA-PX valuation spread in 2018 expanded by 46% in 2017.

The company plans to set up a wholly-owned holding company, Jiangsu Jiatong, to put into production 2 * 250 tons of PTA, 90 tons of FDY, 150 tons of POY.

The total investment of the project is 南京夜生活网 160 million yuan. It is planned to complete the first phase of construction in 2022 and the second phase of construction by the end of 2025.

In addition, the company will launch the fourth phase of Hengteng’s annual output of 30 indicator green fiber projects and the Hengchao annual output of 50 known as the intelligent ultra-simulation fiber project.

The company currently has a PTA capacity of 400 mm and a polyester polyester filament capacity of 570 tons. It is expected to expand to 660 tons by the end of 2019, ranking first in the polyester industry.

After all the above projects are completed, the company will have a PTA production capacity of 900 tons and a polyester filament production capacity of 980 tons. In addition, the company will continue to build an integrated industrial chain layout by adding all the 400 tons of PX production capacity of the Zhejiang Petrochemical Large Refining and Chemical Project with a 20% stake in the company., Effectively consolidate its own polyester faucet attachment.

It is expected that the industrial chain price spread will be restructured in 2019, which is good for PTA and polyester production enterprises: It is expected that the growth rate of the upstream, middle and downstream of the PX-PTA-polyester industry chain will be 7 in 2019.

1%, 3.

5%, 6.

5%, uneven growth in the industrial chain.

It is expected that the cost of midstream PTA will decrease in 2019, and the spread is shifting to midstream.

At present, the price difference of PTAPX is about 1,000 yuan / ton, and the profit margin is being repaired. The inventory of polyester filaments has been reduced, and downstream demand has been restored, which is good for PTA and polyester manufacturers.

Investment recommendations are expected to shift the industry chain price differential to midstream PTA in 2019; the transformation of Zhejiang Petrochemical’s large-scale refining and chemical project will be promoted, and the company’s long-term development logic will continue to be consolidated.
The EPS in 2021 will be 1.

29/1.

49/1.

83 yuan, corresponding PE is 10X / 9X / 7X, maintaining the “buy” level.

Risks suggest that international oil prices have fallen sharply, affecting the enthusiasm of downstream procurement; weak demand in the polyester industry has dragged down the company’s performance; the progress of the Zhejiang Petrochemical Project’s progress beyond expectations will affect the company’s performance and market sentiment; 37.57 million shares will be lifted on June 10, 2019.