In Q1 2009, the company reported business turnover of Rmb610mn (+14.1% yoy), total profit of Rmb21.39mn (+14.4% yoy), net profit attributable to owners of parent of Rmb16.59mn (+1.8% yoy) and diluted EPS of Rmb0.04.
According to 2009 operation plan by AVIC Xi’an Aero-engine Group, the company’s 2009 EPS is predicted to be Rmb0.41. However, its business turnover growth is likely to slow down in the coming two years due to hysteresis of financial crisis on aero-engine subcontract business; supposing expenditure is well controlled, 2010-2011E EPS is predicted to be Rmb0.53 and Rmb0.56 respectively, representing P/E ratio at 46.32x (2009), 35.83x and 33.91x based on closing price of Rmb18.99 on April 22, 2009; considering relatively high P/E, “Neutral” rating is hereby given.