Hualu Hengsheng (600426): Outstanding cost control advantages again highlight the company’s strength

Hualu Hengsheng (600426): Outstanding cost control advantages again highlight the company’s strength

The event company released a quarterly report for 2019 with operating income of 35.

43 ppm, a 10-year increase3.

03%, net profit attributable to mother 6.

42 trillion, down 12 a year.


Analysis of the company’s cost control is excellent, and the profit situation exceeds expectations.

Since the fourth quarter of last year, the price of some products of the company has been changed. The prices of other products have fallen by more than 10%, and some have even reached 30%, which partially replaced the performance increase and revenue growth caused by food production.

However, even so, the company can still exert its own strong cost management and control capabilities, and the industry still has outstanding profitability.

Large-scale companies carry out cost optimization and technological improvements, product production is smooth, and costs continue to fall, so product profitability is relatively limited; reorganization, the company’s tandem production line has been started, and product quality can fully meet downstream high-end ethylene glycol customer requirementsHowever, benefiting from technological optimization and increased production line operating rates, the company’s glucose production cost has dropped significantly. Even if the price drops to the lowest point in the industry, the company can still guarantee a good level of profitability.

The cost of raw materials for mergers and acquisitions decreased to a certain extent. In the first quarter of 2019, the company’s operating gross margin was 28.

55%, only 1 less than the same period last year.

59%, a month-on-month increase of 5.


The platform has excellent management and control capabilities and can flexibly coordinate the production of various businesses.

Since its establishment, the company has long insisted on the business layout of coal chemical industry as the core, horizontally, and initially product extension.

The company’s “segmentation” of business layout, the mid-stage ammonia-alcohol co-production to coordinate fertilizer and chemical business; the latter stage uses methanol as a processor to regulate the production of organic amines, acetic acid, capillaries and other products.

According to the profitability of each product, the start of each business can be flexibly adjusted to expand and increase the company’s profitability.

Benefiting from the continued improvement in the supply and demand structure of the urea industry, the profitability of urea has remained at a high level. The company has expanded the 佛山桑拿网 production and sales of fertilizers and synthetic ammonia products. The product profitability is good, which has promoted the company’s overall profitability.

Actively carry out business layout and increase investment in product research and development.

In 2019, the company launched new amide and nylon material projects and refined adipic acid quality improvement projects to extend the product chain layout.

At the same time in the first quarter, the company significantly increased its R & D investment, increasing by 405 per year.

98%, which is the basis for the company’s continuous technological optimization and business development, and provides the company with long-term development momentum.

Investment suggestions The company’s costs continue to be optimized, raw material prices have fallen, large-scale production 深圳桑拿网 has significantly reduced the cost of new product production, and the company’s profit forecast has been raised6.

8% forecast company 2019?
The EPS in 2021 is 1.

46, 1.

52, 1.

58 yuan, the current price corresponding to PE is 11.

14, 10.

71, 10.

29. Maintain the “overweight” rating.

Risks indicate the risk of fluctuations in crude oil prices; the risk of severe deterioration in downstream demand; and a sharp fall in financial prices.