With the economic recovery this year, the slow growth of wind power bearing
GM 2009 sales of bearings and rail bearings dropped significantly this year, with the economic recovery. Affected by the impact of the economic downturn, the company last year, fell more than 15% of the general bearing and prices declined. This year the products will be along with the economic recovery, taking into account some of the second half of last year, raising the project started to pay dividends, this year¡¯s general bearing of the growth rate will be about 25%; the Ministry of Railways last year, significant decline in the tender trucks, making the company revenue Railway Bearing has dropped by nearly 50% this year, the Ministry of Railways is expected to tender will exceed 2008, so we think that this year¡¯s demand for railway bearings will also be restored to 2008 levels. Last year the company introduced a new fully automated production line, efficiency and quality will increase both expected to increase this year¡¯s railway bearing at least 50%.Wind Power automotive bearing the company¡¯s performance to last year¡¯s main source of growth, but growth will slow this year. Last year¡¯s wind power bearing doubled, but the increasing competition as well as policy adjustment, prices fell about 15%, gross margin decreased significantly compared with 2008, but still close to 50%. In two years will be reduced gradually to 40%.
As the bearing capacity of wind power last year, did not fully released, we believe that with the decline in product prices, the company¡¯s competitiveness will increase, we expect sales growth this year will be in line with industry growth rate in 15%, but growth in profit contribution rate will be lower than this level.
Machine tools slight increase, the future worth looking forward to. Machine tools last year¡¯s revenue nearly 16 billion yuan, up 10%, gross margins increased by more than 2 percentage points. As the current orders in hand, only about less than half a year to maintain production growth this year will not be too fast, no more than the industry average of 15% of the growth, revenue contribution of 18 billion yuan. We are optimistic about the future development of heavy-
duty machine tools space, Qiqihar Heavy CNC adjustment period is over will be the company¡¯s new growth point.
Overweight-B to maintain an investment grade. The next three years is expected to generate earnings per share were 1.13 yuan, 1.34 yuan and 1.54 yuan, nearly 20% compound annual growth rate. According to the 2010 industry average price-earnings ratio of 25 times the dynamic calculation, the corresponding 6-month target price of 30 yuan, to maintain an investment grade holdings-B.
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