Chunfeng Power (603129): The demand for recreational motorcycles is booming and the performance continues to grow

Chunfeng Power (603129): The demand for recreational motorcycles is booming and the performance continues to grow

Event: On January 16th, the company issued an announcement of the 2019 performance pre-increasing announcement, which is expected to achieve net profit attributable 北京夜网 to mothers in 20191.

7 ppm-1.

95 ‰, an increase of 42% -62% in ten years;

500 million yuan-1.

700 million, 10% -30% increase in ten years.

The impact of non-recurring gains and losses on the company’s performance in 2019 was 24 million yuan, mainly due to the wealth management income of the current period, and the increase in tariff rebates and receipt of government subsidies by US subsidiaries.

The recreational motorcycle consumption is booming, and the company’s performance is in line with expectations. The company achieved net profit of 2874 attributable to its mother in 4Q19.

70,000-5374.

70,000 yuan, an annual increase of 24.

7% -133.

1%, the performance was basically in line with expectations, mainly due to the continuous increase in demand for major large-displacement power products for leisure and 杭州桑拿网 entertainment, and the company’s acceptance of orders continued to grow steadily.

The company achieved a net profit of 1459 in 4Q19.

70,000 yuan-3959 yuan.

70,000 yuan.

China-US trade easing and escort ATV business The first phase of the China-US trade agreement has been signed, Sino-US trade disputes are settled in Yuhe, and the impact of tariffs on the company has gradually disappeared.

At the end of 2019, the company received a tax rebate of 1.68 million US dollars, which has a positive impact on the company’s performance.

More than half of the company’s business revenue comes from all-terrain vehicles. The United States is the world’s largest consumer market for all-terrain vehicles. Therefore, the relaxation of Sino-US trade is conducive to the better development of the company’s US business.

When the industrial upgrade transition is underway, the era of autonomous motorcycles as a means of transportation is gradually declining. The era of consumption of leisure and entertainment products has arrived. In 2019, sales of two-wheeled motorcycles of 250cc or more in China will reach 24.

10,000 vehicles, an increase of 47 in ten years.

3%, due to the number of new models launched this year, the sales volume is better than the industry, and the sales growth rate in 2019 has reached 56 in a row.

3%.

At present, the price gap between imported large and medium-sized motorcycles in China and the price of autonomous vehicles is still continuing. Domestic independent motorcycle companies with continuously developing engine manufacturing capabilities and the ability to build mid-to-high-end brands are trying to grasp the current trend of industrial consumption upgrading and achieve rapid growth.

Profit forecast and investment recommendations The high growth of domestic leisure motorcycles and the expansion and promotion of overseas ATVs will jointly drive the company’s rapid growth, and the company is expected to be 1 in 2019-2021.

41/1.

95/2.

70 yuan, the corresponding PE is 36.

7/26.

6/19.

2x, maintaining the company’s “Buy” rating.

Risk reminder: Uncertainty in the Sino-US trade war; market development is less than expected.