Tower Group (002233) performance forecast comment: weather factors cause Q2 volume and price lower than expected 2019H2 demand is still expected to recover

Tower Group (002233) performance forecast comment: weather factors cause Q2 volume and price lower than expected 2019H2 demand is still expected to recover

Event: The company released an interim report for the year 019, and achieved revenue of 28 in 19H1.

59 trillion over five years.

68%, net profit attributable to mother 7.

10,000 yuan, 18 years average.

68%, of which 13 achieved revenue in the second quarter.

8 ‰, 23 years ago.

59%, net profit attributable to mother is 4.

25 ‰, an average of 13 in ten years.


  Opinion: Q2 volume and price fell, performance was slightly lower than expected.

In the first half of 19, the company achieved cement sales of 825.

In December, it grew by 4 per year.

38%, ahead of 杭州夜生活网 the increase in cement output in the first half of Guangdong Province (-2.

4%), but Q2 sales are about £ 445, at least about 45 inches per year.

We believe that the sales volume of Q2 was mainly affected by the continuous rainfall in Guangdong, especially in the eastern part of Guangdong. The slow progress of the construction of the project affected the demand for cement. However, due to the decrease in demand, the company’s cement price fell in the first half of the year.

25%, we estimate that the Q2 ex-factory price is about 310 yuan / ton, which is reduced by about 30 yuan / ton per second. At the same time, due to factors such as the standard vehicle load and environmental protection, the purchase price of cement auxiliary materials has risen, leading to an overall cost increase.The gross profit is about 100 yuan, 佛山桑拿网 at least about 10 yuan / ton for about ten years, and the profit level is obvious.

  Regional demand is supported, and demand for 2019H2 is expected to pick up.

We believe that in the first half of the year under the influence of rain weather, the demand growth in Guangdong was slightly lower than expected, but Guangdong Province1.

The 9 trillion infrastructure investment plan focusing on transportation networks will still boost regional demand. At the same time, the country has repeatedly repeated the role of infrastructure in counter-cyclical adjustments. As the weather improves in 2019H2, infrastructure and rural demand are gradually released.The two rail grinding stations are expected to be put into operation in the middle of the year, and the clinker kiln will eventually be put into operation. The expansion of production capacity will benefit the high prosperity of the region.

  The Guangdong-Hong Kong-Macao Greater Bay Area boosted medium demand.

According to our relevant statistics, the Guangdong-Hong Kong-Macao Greater Bay Area is no less in economic volume than the New York, San Francisco, and Tokyo Big Bay Areas, and has the potential to develop into a first-class Bay Area.We judge that infrastructure investment based on interconnection will become an important carrier for the construction of the Bay Area.

In the first quarter of Shenzhen, Dongguan’s Dawan District project has begun to focus on construction, indicating that related construction has accelerated, and the Tower Group Huizhou plant will benefit significantly.

At the same time, considering that Guangdong’s real estate has a low dependence on shed reform monetization (0.

63%), we believe that the local real estate market is affected by the tightening of this round of income tightening, and demand will remain stable in the medium and transform the continuous advancement of the construction of the Bay Area. The cement demand in South China will continue to grow steadily in the medium and long term;: Based on a more cautious forecast of the industry structure of the South China region and the company’s investment income, we lower the company’s net profit attributable to mothers to 16 in 2019-2020.

24 ppm and 18.

42 trillion, the corresponding EPS is 1.

36 (-0.

19) Yuan and 1.

55 (-0.

25) yuan; target price is reduced to 13.

6 yuan, maintain “Buy” rating.

  Risk warning: the scale of investment in fixed assets expands, production is less than expected, and the price of raw fuels rises sharply;