Tin Industry Co., Ltd. (000960): The company’s profit has steadily increased due to the increase in the price of tin

Tin 厦门夜网 Industry Co., Ltd. (000960): The company’s profit has steadily increased due to the increase in the price of tin
Incident Description The company released its 2018 annual report and achieved operating income of 396.10,000 yuan, an increase of 15% in ten years; net profit attributable to mother 8.81 ‰, an increase of 25% in ten years; net profit after deductions to mothers7.380,000 yuan, an average of 20% in ten years. Comment on the event The company’s operations are stable and its profits are steadily increasing: (1) Tin segment: The volume and price of beneficiaries have increased slightly. In 2018, the company’s tin ingot, tin materials and tin chemical segment revenues increased by 3 respectively.9%, 0.9% and 4.2%.Among them, the average SHFE tin price in 2018 increased by 1.4% to 14.65 million / ton; the company’s tin ore output 3.48 inches, with an annual increase of 2% (the self-sufficiency rate of tin concentrate is about 40%); the output of tin ingots is 3.53 cobalt; tin material 2.85 formaldehyde; tin chemical industry 1.69 cations; (2) Zinc plate: the volume and price decline caused the zinc plate revenue to shift vertically in 2018 7.1%; the average price of SHFE zinc dropped in 2018 by 2.5% to 2.30 million / ton; zinc concentrate output 8.In spring 07, at least 30% of the year.(3) Copper segment: Copper segment revenue increased by 25% in 2018; average SHFE copper price increased by 2 in 2018.7% to 5.07 million / ton; output of copper halogen 10.59 annual growth of 14% per year. The relatively weak performance of Q4 2018 caused a certain drag on the relative performance: 2018Q1-Q4 achieved net profit attributable to mothers1.76, 2.77, 2.76, 1.5.3 billion, of which the net profit after deducting non-return to mothers in Q4 2018 was only 0.54 ‰, the previous budget was 86%, which has a certain impact on improving performance.Investigating the reasons, (1) In the fourth quarter of 2018, Yunxi Wenshan Zinc produced 10 tons of zinc per year, and a 60-ton continuous production line was built for trial production. The zinc concentrate purchased from Hualian Zinc Indium entered the production process and partially formed semi-finished products.Goods and other intermediate materials.After the completion of Hualian Zinc and Tin’s capital increase, the company’s shareholding ratio decreased to 68.55%, achieving a net profit of 10 in 2018.08 million yuan, an increase of 25% in ten years.(2) The company’s November 2018 maintenance plan for the smelting branch also had a certain impact. The company’s three major points worth paying attention to in 2019: (1) The company’s domestic market share of tin metal in 2018 is 44%, and the global market share is 20%; it has tin smelting capacity of 8 per year / year, and tin material capacity of 4 possible / year, Tin chemical production capacity 2.6 every year.By providing continuous verification of the contraction logic, the tin price hub is expected to rise, which is beneficial to industry leaders.(2) In 2019, Wenshan Zinc Indium will produce 10 ores of zinc per year, and 60 tons of continuous projects will gradually reach full production. The high operation of zinc smelting processing fees is expected to contribute new growth points for the company.(3) The company’s repurchase plan decides that all the repurchased shares shall be encouraged by the employee stock ownership plan or equity, gradually increasing the incentive for employees to produce, and improving the incentive mechanism.Based on this, we expect the company’s 2019 performance to be flat, and it is expected that the eps for 2019-2021 will be 0.66, 0.78 and 0.88 yuan, corresponding PE is 19X, 16X and 14X. Risk Warning: 1. The import volume of overseas tin ore grew faster than expected, and the Myanmar government released a large amount of inventory; 2. Downstream demand for tin has grown significantly, and orders for electronic tin solder have decreased significantly.