On November 4, 2021, Jinhong Gas (688106) issued an announcement that: Sun Jiezhen of BOCOM Schroder Fund, Gu Wu of Shenwan Lingxin Fund, Zhang Yanmin of Southern Fund, Chen Yalong of Industrial Asset Management, Tang Jie of Tianfeng Securities, Liu Yiwu Haibo of Essence Securities Gao Hongyu investigated our company on November 2, 2021.
The main contents of this survey are:
Q: The gas industry has good cash flow, why are cooperative companies willing to be acquired?
A: Mainly because the founder of the acquired company is older and the second generation is reluctant to take over.
Q: Is the entry threshold for the new land construction plant of the gas filling station project high?
A: The threshold is relatively high, because the gas filling station project has the attribute of dangerous chemicals, and the government is more cautious when approving new projects.
Q: Why is the company's account period short and the operating cash flow is good?
A: There are mainly two reasons, one is because the company's channels sink deeper, mainly sold directly to end customers, supplemented by sales to gas companies; second, the company has good quality and excellent service in terms of gas purity and pressure, and has won customer recognition.
Q: After the company's acquisition of the new bulk gas company, how long will it take to integrate to a relatively good profit level?
A: The time required for integration is related to the degree of standardization of the target itself, 2-3 months with a better foundation, 6 months for worse ones, and longer for technical changes on hardware.
Q: What are the main areas of the company's planned layout?
A: Focus on the layout of East China, followed by the central region, Sichuan-Chongqing region, Pearl River Delta region, Beijing-Tianjin-Hebei region.
Q: How is the company's layout of air separation capacity considered?
A: In order to ensure the safety of the company's upstream supply chain, the company strategically laid out air separations, increased the self-production rate of bulk gases, and focused on locking in long-term stable profits.
Q: How well do integrated circuit customers recognize Jinhong?
A: The company's certified integrated circuit customers generally have a relatively high evaluation of Jinhong.
Q: Why is the gross profit of the company's special gas products much higher than that of its peers?
A: The company's special gas products mainly occupy the market through direct supply to end customers.
Q: Is the gross profit of specialty gases higher than that of bulk gases?
Answer: Not necessarily, it depends on the advanced nature of specific special gas products, compared with larger gas products, special gas products required for special cylinders and valves with high input and low turnover, and the gross profit margin of bulk gases can be very high.
Q: Is there any plan for issuing bonds or additional issues behind the company?
A: In considering the strategic planning, the company currently has abundant funds, healthy cash flow, and a large amount of bank credit available.
Q: Is the due diligence of the company's M&A project entrusted to a third party?
A: At present, the company has a set of strict M&A risk control system, and the project due diligence is mainly based on the company's functional departments, including auditing, production, environmental security, legal affairs, etc., they know more about the industry than third parties, and also save due diligence costs.
Q: In which areas is the company growing faster in the market?
A: It has grown rapidly in integrated circuits, pharmaceuticals and food, and new materials.
Jinhong Gases main business: gas research and development, production, sales and service of environmentally friendly intensive integrated gas suppliers
Jinhong Gas's 2021 third quarter report shows that the company's main revenue was 1.234 billion yuan, up 37.17% year-on-year; net profit attributable to the mother was 126 million yuan, down 11.96% year-on-year; deducted non-net profit was 92.5088 million yuan, down 25.12% year-on-year; among them, in the third quarter of 2021, the company's single-quarter main revenue was 455 million yuan, up 29.56% year-on-year; single-quarter net profit attributable to the mother was 38.6895 million yuan, down 35.49% year-on-year. In the single quarter, the non-net profit was 24.071 million yuan, down 54.04% year-on-year; the debt ratio was 32.38%, the investment income was 7.9505 million yuan, the financial expense was -7.1578 million yuan, and the gross profit margin was 30.9%.
In the past 90 days, a total of 4 institutions have given ratings, 3 buy ratings and 1 overweight rating; the target average price of institutions in the past 90 days is 36.4; the net outflow of financing in the past 3 months is 101 million, and the balance of financing has decreased; and the net outflow of margin is 6.6468 million, and the balance of margin is reduced. The Securities Star Valuation Analysis Tool shows that Jinhong Gas (688106) has a good company rating of 3.5 stars, a good price rating of 1.5 stars, and a comprehensive valuation rating of 2.5 stars.
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