Sangang Minguang (002110): Improved profitability is expected to stabilize and rebound

Sangang Minguang (002110): Improved profitability is expected to stabilize and rebound

This report reads: The company’s first-quarter performance in 2019 is in line with expectations. The company’s profit has fallen due to the weak season and rising costs, but it can be replaced.

We expect that through the stabilization of costs and the continued strong downstream demand, the company’s performance will stabilize and rebound.

Investment Highlights: Maintain the “overweight” rating.

The company achieved operating income of 83 in the first quarter of 2019.

470,000 yuan, a slight decrease of 0 a year.

45%; net profit attributable to mother 9.

62 trillion, down 32 a year.

2%, the company’s performance was in line with expectations.

Maintain the company’s EPS for 2019/2020/2021 to 3.

08/3.

14/3.

17 yuan forecast.

Maintain the company’s target price of 26.

14 yuan, maintaining the “overweight” level.

Affected by rising costs, the company’s profit growth in the first quarter declined, but still showed the expected replacement.

In the first quarter of 2019, iron ore supply is expected to tighten due to the Vale dam breach and the impact of the Australian hurricane, and iron ore 北京桑拿洗浴保健 prices have risen sharply.

Affected by rising costs and the low season of downstream demand, the company’s first quarter profit fell, but the industry’s comparison, the company’s profit forecast.

We expect the continued strong downstream and downstream demand and the high level of iron ore prices to stabilize, and the company’s earnings will stabilize and rebound.

Asset-liability ratio continued to decline, and net operating cash flow continued to rise.

In the first quarter of 2019, the company’s assets and liabilities were restructured31.

26%, a decrease of 3 from the end of 2018.

For 49 units, the company’s asset credit ratio continued to decline.

In the first quarter of 2019, the company’s net operating cash flow5.

4.5 billion, a year-on-year increase of 4 in the first quarter of 2018.

04 billion.

The 杭州桑拿 company’s operation is stable and better, and the company’s overall strength is constantly increasing.

Infrastructure confirmed a rebound, and demand stabilized in the second quarter.

The growth rate of infrastructure investment in the January 2019 quarter confirmed a rebound, while real estate investment was stable, and new construction started beyond expectations.

We expect the infrastructure rebound to continue and real estate to continue to sustain, and downstream demand will remain stable in the second quarter.

After the impact of the accidents in Brazil and Australia is gradually digested, iron ore prices will stabilize at a high level.

We believe that the stabilization of costs and the stabilization of demand will drive the company’s earnings to stabilize and rebound from the second quarter.

Risk warning: the macro economy is accelerating to decline; the supply side rises more than expected.