Best: Guosen Securities, Tianfeng Securities and other 8 institutions investigated our company on October 22

On October 25, 2021, Best (300580) issued an announcement that Guosen Securities Zhu Zhangyuan, Tianfeng Securities Li You, Huatai Securities Cai Xuan, Taiping Fund Su Daming, GF Fund Li Xiao, Huatai Securities Jiang Xin, Yongying Fund Shen Shengjie, Caitong Asset Management Zheng Zihong investigated our company on October 22, 2021.

The main contents of this survey are:

Q: The basic information of the company:

A: Founded in May 1997, the company has built five modern intelligent factories in Wuxi Hudai Industrial Park for more than 20 years, with assets of more than 2.8 billion yuan. Since its inception, the company has been focusing on the research and development, production and sales of precision parts and intelligent equipment and tooling products, and taking advantage of various first-mover advantages in the field of intelligent equipment and tooling, and has also extended its business to high-end aviation equipment manufacturing and industrial automation equipment. Since the development of the company, it has formed the core competitive advantage of the linkage development of the four major industries of "tooling fixture, casting industry, precision machining and intelligent manufacturing". In recent years, the company has closely followed the pulse of the times, actively met the challenges of the industry, and vigorously developed the new energy automobile industry under the two-wheel drive development mode of "endogenous development and epitaxial expansion": focusing on the development concept of "green, intelligent and low-carbon", the company invested in the construction of new five and six phases of factories, accelerated the layout of the new energy automobile industry, further expanded the scale of business, and consolidated the layout of the new energy automobile industry. The company adheres to technological innovation as the driving force, has an efficient R & D team, and has built a standardized, systematic and process-oriented R & D system. Among them, the artificial intelligence defect visual identification sorting workstation, CNC dual-station turntable, automatic deburring workstation, automatic intelligent fixture with perception and adaptive functions and other products developed by the company have realized the replacement of the original manual production unit with low efficiency and quality, high worker skills and labor intensity, and realized the automatic, efficient, intelligent and unmanned and less humanized production direction of mechanical processing.

Q: Introduction to the company's recent performance:

A: Since the beginning of this year, despite the repeated epidemics, rising raw material prices and chip shortages, the company has maintained high-quality development. In the first three quarters of this year, the company achieved operating income of 777 million yuan, an increase of 15.47% year-on-year; net profit of 159 million yuan, an increase of 28.24% year-on-year; net profit after deduction of non-profit of 132 million yuan, an increase of 17.89% year-on-year.

Q: Please tell us about the company's main products and competitive advantages?

A: At present, the company's main products include turbocharger precision bearings, impellers, intermediate shells, compressor casings and engine blocks for hybrid power vehicles and fuel vehicles, electric vehicle functional parts such as vehicle charger components and DC converter components, lightweight structural parts such as steering knuckles, hydrogen fuel electric turbo compressor housings, full milled impellers, bearing covers and functional parts, seat components, connectors and other aircraft cabin parts, used in automobiles, Intelligent equipment and tooling in the field of rail transit, as well as intelligent manufacturing system integration products such as aircraft fuselage automated drilling and riveting systems and production automation systems. About the company's competitive advantage: First, there are high barriers to market access in the company's industry. Auto parts downstream customers have high quality service requirements for their suppliers, long pre-assessment cycle, complex review and certification system, from qualification audit to the establishment of stable cooperative relations generally take 1-3 years, so its transfer cost is relatively high, once the establishment of cooperation will not easily change suppliers. The high-quality and rich customer resources accumulated by the company are an important support to ensure stable performance and sustainable development. Second, unique technical advantages. The company has a wealth of technical accumulation in the field of intelligent equipment and tooling, and the fixture can achieve precise positioning, and precise positioning is the basic premise of precision machining. The actual demand for precision parts processing has promoted the improvement of tooling fixture technology, while high-performance tooling fixtures have also provided favorable technical support for the expansion of the company's precision parts processing business, and the mutual promotion and linkage of the two have become the company's unique technical competitive advantage over the years. Finally, the advantages of product diversification. The company has a high-quality customer base and related product design and production experience in many industries, including automobiles, aviation, refrigeration equipment and pneumatic tools, and has flexible production capacity, which can adjust the production line and product structure in a timely manner according to the fluctuations of the downstream industry cycle to ensure the stability of the company's operating performance.

Q: What about the company's layout in the new energy automobile industry?

A: While enlarging and strengthening the existing business, the company vigorously lays out the new energy automobile industry, and enters the new energy automobile industry from multiple tracks such as pure electric vehicle parts, hydrogen fuel cell vehicle parts, and hybrid vehicle parts. In terms of the core components of pure electric vehicles, the company has established cooperation with Tesla, a benchmark enterprise in the field of new energy vehicles, and with the gradual release of the production capacity of the company's convertible bond investment projects, it will further enhance the research and development, manufacturing and sales of lightweight structural parts of new energy vehicles. In addition, the company also jointly holds subsidiaries Suzhou Herbes and Yitong Lightweight to make full use of existing resources and platforms to expand new business on the basis of the original business. In terms of hydrogen fuel cell auto parts, the company has also long been laid out, related products include: hydrogen fuel electric turbo compressor housing, hydrogen fuel electric compressor full milling impeller, bearing covers and functional parts, etc., downstream customers include: Bosch China, Garrett, Headwell and other domestic and foreign high-quality enterprises. Hybrid vehicle parts, the company's products of hybrid drivetrain structural parts and turbocharger core components are generally applicable to hybrid vehicles, the company has been with Garrett (Garrett), Cummins (Cummins), Boma Technology (BMTS), Changchun Fuao Ishikawa Island (FIT), BorgWarner (BorgWarner), Pierburg (Pierburg), Ningbo Fengwo, Shanghai Lingzhong (SMTC), Mitsubishi Heavy Industries (MHIET) and other well-known enterprises at home and abroad have established long-term strategic cooperative relations, and the company has continued to actively participate in the innovative research and development of new products for customers, and follow customers to expand new fields and new businesses. In this exchange meeting, the company strictly implemented in accordance with the relevant management systems and regulations of information disclosure, ensured that the information disclosure was true, accurate, complete, timely and fair, and did not disclose major information leakage, and at the same time, in accordance with the requirements of the Shenzhen Stock Exchange, arranged for researchers to sign the "Letter of Commitment".

Best's main business: R & D, production and sales of various precision parts and fixture products.

According to Best's 2021 third quarterly report, the company's main revenue was 777 million yuan, up 15.47% year-on-year; the net profit attributable to the mother was 159 million yuan, up 28.24% year-on-year; the deduction of non-net profit was 132 million yuan, up 17.89% year-on-year; among them, in the third quarter of 2021, the company's single-quarter main revenue was 261 million yuan, down 14.86%; the single-quarter net profit attributable to the mother was 51.9595 million yuan, down 14.43% year-on-year. In the single quarter, the non-net profit was 41.3584 million yuan, down 27.31% year-on-year; the debt ratio was 33.12%, the investment income was 9.8779 million yuan, the financial expense was 4.4161 million yuan, and the gross profit margin was 35.26%.

In the last 90 days, the stock has been rated by 3 institutions, 2 on the buy and 1 on the overweight; the target average price for institutions in the past 90 days is 31.75; the Valuation Analysis Tool of The Star of Securities shows that Best (300580) has a good company rating of 2.5 stars, a good price rating of 3.5 stars, and a valuation comprehensive rating of 3 stars.