Subbot (603916): The performance has surpassed expectations, and the leader of admixtures has started to grow.

Subbot (603916): The performance has surpassed expectations, and the leader of admixtures has started to grow.
Event overview.The company announced the announcement of 2019 pre-increasing results.The company’s net profit attributable to mothers is expected to increase by 25-35% annually in 2019 (3.35-3.64ppm), corresponding to the net profit attributable to mothers of 84 million to 1 in Q4 2019.1.3 billion US dollars, a year-on-year growth of 75-135%; net profit after deducting non-attribution is expected to increase 130-150% each year. The sales volume increased greatly, the cost decreased, and the performance exceeded expectations.Even in accordance with the lower notice limit, the company’s performance also exceeded our expectations and market expectations.Benefiting from channel expansion and industry consolidation, the company’s sales of admixtures increased in the first three quarters of 2019.0%, the average viscosity of admixtures continues to rise from 12 yuan / ton to 2249 yuan / ton against the background of the increase in the proportion of customers in engineering mining, which reflects the company’s product competitiveness. As cement demand remains good, we judge that the fourthThe growth rate of quarterly sales volume is consistent with the first three quarters, and the average purity remains stable.At the same time, as the average price of East China’s alkyl aromatics in 2019 alternately decreased by about 2500 yuan / ton to 7800 yuan / ton, we gradually reduced the company’s cost per ton of product breakdown by about 200 yuan / ton (10-15%), thereby making a profitThe growth rate is significantly higher than income. Industry consolidation will continue, and the company’s core benefits.Due to the increase in the proportion of machine sand, the downstream concrete industry’s demand for admixture performance and on-site deployment technical guidance has increased. We judge that a large number of small companies (more than 90% of the industry) that can only purchase mother liquor for simple processing will gradually beElimination and elimination, along with the acceleration of 杭州桑拿 the national expansion of the right-side enterprises, we correctly judge that the market share of the enterprises will accelerate.At present, the company’s market share as the industry leader is only 3.7% (according to the actual sales volume and income caliber), the industry CR10 is only 19.3%, huge space for future integration. Endogenous + epitaxial two-wheel drive, 2019 may just be a prelude to high growth.We believe that the company’s admixture business will maintain a high growth rate in the next 3-5 years under the background of industry integration and company expansion (measured to expand production capacity by 80% in 2021), and the Jiangsu Testing Center acquired by the company is testingThe companies on the right side of the industry (close to the top 1 ‰) are expected to benefit from industry consolidation and develop steadily. We believe that the company’s revenue will still maintain rapid growth.In addition, through the company’s Sichuan base put into operation, the company’s transportation costs and three rates will gradually decline, increasing the company’s profitability, 2019 may just be the beginning of the company’s high growth cycle. Investment Advice.We temporarily keep our profit forecast unchanged, and we will update further when the company releases more data.The company is expected to have a net profit for 2019-2021.16/4.16/5.50 ppm, a ten-year increase of 17.8% / 31.4% / 32.4%.Maintain target price of 20.RMB 88 and “Buy” rating. risk warning.Demand is lower than expected, costs exceed expectations, testing business development exceeds expectations, and systemic risks.