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Huafang Textile: Lithium Power Manufacturing Steadily Push Forward Profitability Of Textile Business

2011/4/27 15:38:00 63

Raw Materials Huafang Textile Overseas Market

Huafang textile Limited by Share Ltd Limited by Share Ltd lithium iron phosphate battery production line to maintain capacity utilization.

The company's annual production capacity of 8 million Ah production line has been put into operation since the beginning of the year, the current order quantity has been able to guarantee the utilization rate of about 50%, the product is mainly 8-10Ah electric bicycle lithium battery, and the battery pack composed of 10 batteries is priced at about 1200 yuan.

Products are mainly exported to Europe, Canada and so on.

overseas market

As the lithium battery is still a high-end product in the field of electric bicycles and motorcycles, the domestic market is limited. We expect that the company's lithium battery products will still be exported in the future.

The subsequent release rate depends on downstream demand.

The company plans a total of 7 lithium battery production lines, at present, the other two have started construction process, and the subsequent expansion will depend on the speed of downstream market opening.

Company

Raw material

They all depend on outsourcing, including cathode materials and diaphragm imports, negative materials and electrolytes supplied by domestic suppliers (the company is trying out the self produced electrolyte).

Jiangsu Li Tian company (equity share ratio 70%) will gradually expand and deepen the industrial chain on the basis of product sales, and may further expand its upstream core raw materials in the future.

Battery products and electrolyte projects are certified through environmental protection.

At present, there is no mandatory certification standard for lithium batteries of electric bicycles in China. Currently, the company has passed the environmental certification of CE and ROHS in Europe and the ongoing US UL safety certification.

The electrolyte project of Alex Hua Tian company (share ownership ratio 70%) passed the EIA and safety assessment in June, and is expected to be formally put into operation in the second half year.

R & D and vehicle power battery industrialization continues.

After setting up its own R & D team, the company has established a cooperative relationship with Tsinghua University and Shanghai Jiao Tong University. Its research and development contents include positive and negative electrodes, electrolyte materials and power battery and integration technology.

40Ah's power battery is being tested and tested. In the future, with the release of the demand for new energy vehicles, the company can directly use the existing production line to produce power and energy vehicle batteries.

The textile business improved this year.

Cotton yarn business

The main reason for this year's increase in profits is the increase in cotton and cotton yarn prices, while the company's cotton reserves are adequate and the cost of raw materials remains low.

The company's 275 thousand spindles currently maintain a net profit level of 300 thousand yuan per 10000 yuan per month, with a reasonable estimated profit of about 80 million yuan in the year and a corresponding EPS of 0.26 yuan.

In the medium term, cotton prices will remain at a high level, but the gross profit margin of cotton yarn business in the next two years will also drop.

There is no specific timetable for overall listing.

There are more related pactions between the company and the group, and the overall listing is strong, but there is no specific timetable yet.

To increase the company's rating.

The company has adopted a more cautious and gradual development approach to the lithium battery business. We also believe that the promotion of new energy vehicles is not overnight.

Based on the above judgment, without considering the company's real estate income, our Forecast Ltd 2010~2012 EPS is 0.35, 0.42 and 0.61 yuan, corresponding to the current PE37.6, 31.4 and 21.6 times, the current valuation is more reasonable, given the overweight rating, it is recommended to pay close attention to the release rate of lithium battery production capacity.