Affected by the policy, the industrial mother machine industry has attracted market attention in recent months. Many analysts believe that although the manufacturing demand has reduced risks, the industrial mother machine is still a track worthy of attention in 2022, and the prosperity of the industrial mother machine market this year has been optimistic about many professional institutions.
Cinda Securities believes that since 2020, the output of metal cutting machine tools in the mainland has begun to rebound rapidly, and it is still maintaining sustained growth, and in the context of the steady development of the mainland manufacturing industry, the machine tool industry will have a good growth period. It is expected that the high prosperity of the industry will benefit a number of related listed companies.
As the leader of A-share CNC machine tools, Genesis (300083) recently issued a performance forecast announcement, benefiting from the industry recovery and policy support, the company achieved a turnaround in 2021, and the profit is expected to grow by more than 160%. Among them, the high demand for 3C electronics and general purpose machine business is the main reason for the company's substantial growth last year, and several new products such as horizontal machining centers will become the company's incremental sources in the future.
The concept of industrial mother machine continues to be hot At the policy level, strong encouragement and support are encouraged
After the Spring Festival holiday in the Year of the Tiger, the industrial mother machine sector continued to receive attention, and the concept index rose for many consecutive days. In fact, the focus on industrial mother machines has already begun in 2021, and even became one of the hottest concepts in the second half of last year.
Industrial mother machines refer to machines and machinery in a broad sense, and machine tools in a narrow sense. As a strategic industry, the industrial mother machine is at the forefront of the entire manufacturing industry chain, carrying the foundation of the entire manufacturing industry. At present, the mainland is in the stage of industrial structure adjustment and upgrading, advanced manufacturing industry is gradually replacing the traditional manufacturing industry, CNC machine tools, especially high-end CNC machine tool industry ushered in accelerated development.
In terms of policy, according to the "14th Five-Year Plan", the mainland will further promote the optimization and upgrading of the manufacturing industry, cultivate advanced manufacturing clusters, and promote the innovative development of high-end CNC machine tools and other industries. The draft of the "14th Five-Year Plan for Intelligent Manufacturing Development" released in April 2021 also expressed strong support for the development of industrial mother machines.
In recent days, the A-share industrial mother machine sector has continued to rise, and there is no lack of policy support. The executive meeting of the State Council held on February 14 pointed out that for the new purchase of equipment and appliances worth more than 5 million yuan for small and medium-sized enterprises this year, the depreciation can be deducted for 3 years, and the depreciation can be halved for 4 years, 5 years and 10 years.
Industry insiders said that with the accelerated transformation of China's manufacturing industry and the rapid rise of emerging industries such as precision molds, aerospace, rail transit, and biomedicine, due to its manufacturing process, it will become a new growth point for the CNC machine tool industry due to its high dependence on intelligent manufacturing equipment such as CNC machine tools. The agency expects that by 2026, the scale of China's CNC machine tool market will exceed 500 billion yuan.
China's CNC machine tool industry leader achieved substantial growth in 2021
Benefiting from the favorable policies and markets, in 2021, the A-share industrial mother machine sector had a good trend, but then, the entire sector entered the adjustment cycle. At present, after a period of adjustment, the valuation of the sector has been at a historically low level, and the relevant leading companies also have strong allocation value.
Taking Genesis, the leader of China's CNC machine tool industry, as an example, the company's performance in 2021 is excellent. According to the performance forecast, the company is expected to achieve revenue of 4.118 billion yuan in the first three quarters of 2021, an increase of 66% year-on-year, of which high-end machine tool revenue accounts for nearly 100%; in 2021, it is expected to achieve a net profit attributable to the mother of 460-520 million yuan, achieving a turnaround and a substantial increase.
In addition, Genesis basically completed the integration and divestiture of the precision structural parts business at the end of 2020, and the CNC machine tool business is now the company's only core main business. According to the "2021 Analysis of the Market Competition Pattern of Leading Enterprises in China's CNC Machine Tool Industry", the leading enterprises in the CNC machine tool industry in mainland China were compared and analyzed from the aspects of CNC machine tool production and sales, production and sales rate, and operating income. Statistics show that Genesis ranks among the best in the industry in terms of core indicators such as production and sales of CNC machine tools and production and sales rate.
In recent years, Genesis has always adhered to innovation-driven development, and attached equal importance to applied research and development and forward-looking research and development, laying a solid foundation for long-term development. On the one hand, Genesis's high-end CNC machine tools firmly occupy an absolute leading position in the 3C field, ranking first in the world in the shipment of drilling and tapping machines; at the same time, the company further develops downstream application channels on this basis and broadens the company's development track.
Since 2021, Genesis has actively promoted the non-3C application of 3C products based on the rapid response capabilities of the technical and business ends for drilling and tapping machine products, and actively developed the metal processing field of UAVs, electronic cigarettes, new energy vehicles and other related parts for the strong demand of emerging markets.
On the other hand, Genesis has developed a number of super explosive vertical processing centers favored by the market through independent research and development. Taking the T-V856S linear rail vertical machining center as an example, the product uses high-precision roller rail and ball screw, so that the machine tool has better dynamic responsiveness, can achieve high-speed and high rigidity cutting, and is widely used in 5G, new energy vehicles, precision parts and other industries.
In addition, in terms of domestic substitution of imported high-end machine tools, Genesis has also been laid out. In 2021, Genesis established a wholly-owned subsidiary, Heller Precision Machinery (Zhejiang) Co., Ltd., which is mainly responsible for operating its high-end brands, and has released a number of high-end products. Genesis said that high-end products are the fist products of Genesis benchmarking international first-line machine tool brands, and will fully impact the domestic high-end market with the help of its high-end brands in the future.
The National Manufacturing Fund invested in deep ploughing technology research and development to achieve domestic substitution
With the continuous expansion of the core main business operation scale, the development trend of Genesis continues to improve, and the company has become the first CNC machine tool enterprise invested by the National Manufacturing Fund. Genesis said that last year, due to the investment of the national manufacturing fund and the landing of the fixed increase, the company's book cash flow was abundant, the asset-liability ratio declined, and the financial structure was improved, and the company has changed from the past to the current development, and began to increase investment in research and development, reserve technology, develop new products, and create star explosive products.
Industry insiders analyze that in the future, new energy, electric vehicles, and 5G communication industries will drive lathes, horizontal processing and gantry to grow rapidly, and new energy vehicle machine tools are expected to account for 10% of the company's revenue in 2022. From the perspective of revenue and shipments, Genesis has now ranked first in domestic general-purpose CNC machine tools. The company has doubled its sales for four consecutive years, shipping more than 10,000 units in 2021. At present, the company is extending its product line from Lijia to wojia, lathes and gantry.
In addition, in the 3C business, stock replacement and emerging demand will drive the steady growth of China's drilling and tapping machine leaders. Genesis 3C product drilling and tapping machine has accumulated shipments of more than 80,000 units, as a core supplier of North American customers, has been deeply recognized by BYD, Changying, Luxun, Goertek and other customers. At present, the entire 3C market has an annual market size of about 50,000 units and 10 billion yuan.
In addition, in December 2021, Genesis also released an employee stock ownership plan, with a total capital limit of 200 million yuan, and the participants included Chairman Xia Jun and deputy general manager and board secretary Zhou Qichao, two senior executives of the company. The employee stock ownership plan highlights the company's confidence in medium- and long-term development, and the company is expected to seize the opportunity of the rapid development of the CNC machine tool industry and achieve sustained and stable growth in performance.
High-end intelligent equipment is a national strategic emerging industry, and the Prospective Industry Research Institute predicts that the market size of CNC machine tools in the mainland will grow from 412.8 billion yuan in 2020 to 572.8 billion yuan in 2024. There is a huge room for improvement in the localization rate of China's high-end machine tool industry.
In August 2021, the SASAC stressed the need to strengthen key core technologies for industrial mother machines and high-end chips. At present, the global machine tool industry is mainly controlled by Japan, Germany and the United States, Genesis as a leading enterprise in China, the business is mainly composed of general machine tools and 3C machine tools, the future will have a huge market share improvement opportunities, broad prospects for development.