Event:
The company released its 2008 annual report, of which it achieved revenue of main business of Rmb6.458bn (+108.11% yoy), net profit attributable to shareholders of parent of Rmb915mn (+45.23% yoy) and EPS of Rmb0.91.
Additionally, according to its distribution plan, the company sent 4 additional shares and dividend of Rmb2.8 cash for every 10 shares.
Our Analysis and Estimation:
1. The company’s performance is in line with our expectation;
2. Its gross margin will continue declining;
3. Its national capacity layout has been accomplished and research & development of new-typed machines goes smoothly;
4. Disclosed indent statistics shows that the company’s indent volume in Q4 2008 is greatly impacted by the macro environment;
Investment Suggestion:
We forecast that wind power will maintain CAGR at ~20% in the coming years; as one of the strongest domestic wind generator manufacturers, the company will face better development opportunities, yet it is not realistic to continue the rapid growth a few years ago.
We predict that the company’s future performance growth tends to stabilize with the industrial slowdown and its 2009-2011E EPS will be Rmb1.30, Rmb1.58 and Rmb1.94 respectively; current share price has already been close to the rational level, thus we lower the rating to “Cautious” for the counter.