Expert Analysis: Value Of Xinye'S Big Textile Stocks

Xinye textile, the stock market in November 2006, is a large country.

Backbone enterprises, one of the 520 in the country and one of the 50 key supporting enterprises in Henan Province, mainly produces and operates four series of more than 100 varieties, including pure cotton and blended yarn, pure cotton and blended fabrics, dyed fabrics, household textiles, etc., with an annual output of 90 thousand tons of high-grade textile yarn and 150 million meters of clothing fabrics.

Products exported to Guangdong, Jiangsu, Fujian and other more than 20 provinces and cities and the United States, the European Union, Japan, South Korea, Hongkong and other 12 countries and regions.

Event:

Xinye textile announced the 2013 China Daily.

During the reporting period, the company achieved operating income of 1 billion 581 million yuan, an increase of 3.69% over the same period last year, and realized a net profit of 47 million yuan, an increase of 15.3% over the same period last year, achieving a profit of 0.09 yuan per share.

Comments:

Double growth in gross and interest rates.

The company's gross profit margin in the first half of 2013 was 11.99%, an increase of 17.55% over the same period last year. There are two main reasons for the increase in gross profit margin. First, the 60 thousand tons of cotton raw material supply base in Xinjiang has been put into operation. The two reason is that the quota of imported cotton has increased over the past year, and there is a huge price difference between imported cotton and domestic cotton. The above two factors have reduced the cost of raw materials and raised the gross margin level of the company.

During the first half of the year, the cost increased by 16.85%.

Sales expenses increased by 13.79% compared to the same period last year, management fees increased by 48.48% compared to the same period last year, financial expenses grew by 5.4% over the same period last year, and the increase in management fees was mainly due to the increase of R & D expenses by 20 million 690 thousand yuan over the same period last year.

Domestic cotton prices have declined.

Since April, cotton prices have shown a downward trend. As of August 28th, the domestic cotton price index of 328 was 19162 yuan / ton, 1.16% lower than the highest in the current year, and the decline in cotton prices has improved the profitability of the company.

The one hundred and forty thousand spindles special yarn project is the future.

At the end of 2012, the company invested 538 million yuan to build one hundred and forty thousand special yarn production lines in Xinye textile industrial area by self financing and bank loans. It mainly produced siro spinning, combed yarn, elastic core spun yarn and other special yarn products. After the project reached 50%, the special yarn products were exported directly, and about 40% of the products were exported by the company to produce high-grade fabrics. The project is expected to reach production in the middle of 2014.

The technical threshold and trade barriers of textile industry are relatively low, and the profit margin of primary products is very low. After the project is put into production, it will improve the product structure and enhance the profitability of the company.

Development and Reform Commission solicited

Cotton prices are expected to decline as a result of reform.

In the total cost of cotton spinning enterprises, the cost of cotton will account for 70%.

The current cotton purchase and storage body is heavily burdened with financial burden, and farmers are not fully able to get the benefits of the policy. However, the domestic cotton price has been at a high level for a long time, resulting in a huge price gap with the international cotton price, resulting in the closure of a large number of small and medium-sized cotton spinning enterprises.

The NDRC has recently solicited opinions on the cotton system reform plan, and the parties have basically reached a consensus on the policy direction of implementing cotton direct subsidy. In the long run, the cotton system reform will reduce domestic cotton prices and enhance the profitability of the textile industry.

Investment advice:

It is estimated that the earnings per share in the 13, 14 and 15 years are 0.18 yuan, 0.24 yuan and 0.33 yuan respectively.

According to the closing price of 3.38 yuan in August 28th, the corresponding P / E ratio is 19 times, 14 times and 10 times respectively, giving the "overweight" rating.

Risk warning:

Special yarn project profit is lower than expected risk.

Volatility risk.