The hottest new chemical materials industry can st

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The new chemical materials industry can still pay attention to the good prospects

the operating revenue of chemical industry (shenwanyi industry) in the first quarter of this year decreased by 1.85% month on month, while the net profit attributable to the parent company increased by 67.54% month on month, indicating that the decline in costs and expenses formed a major contribution to the growth of net profit

from the perspective of operating costs, this sector fell by 1.2% in the first quarter of this year compared with the fourth quarter, indicating that the main factor of the decline in operating revenue is the decline in operating costs. At the same time, Zhou Changyi, director of the raw materials department of the Ministry of industry and information technology, published a signed article in this newspaper on October 11, 2016, pointing out that the slight decline in the gross profit ratio also means that the sales price of products may decline

however, while the gross profit margin of sales decreased slightly, the net profit margin of sales increased from 2.41% in the first quarter of last year to 4.16% in the first quarter of this year, an increase of 1.75 percentage points, an increase of more than 70%. This means that the increase in net profit is mainly due to the decline of three expenses

overall, the operating situation of the chemical industry in the first quarter was not ideal. The reason is that the first quarter is the cold winter season, and many products are in the off-season. After the second quarter, many products enter the peak season. For example, the massive resumption of construction will drive the sales of many chemical products, and the agricultural fertilization and medication will also increase. Therefore, it is expected that the business environment of the industry will improve, which is conducive to its product sales and the loading method may be affected by humidity, power voltage, frequency, magnetic field, air flow, electromagnetic radiation, static electricity, etc. to varying degrees, and the gross profit margin will be improved, It is expected that good performance will still be achieved in the second quarter

however, the chemical industry has a long industrial chain, and there are great differences in sub industries, so there will be great differences in profitability. According to the analysis of financial indicators in the first quarter, new chemical materials (Shenwan secondary industry) still deserves attention

data show that the operating revenue of new chemical materials in the first quarter of this year increased by 3.27% month on month, while the net profit increased by 183.8% month on month. It is worth noting that its gross profit margin in the first quarter of this year increased to 19.91% from 15.54% in the fourth quarter of last year. As its operating costs fell by 1.57% quarter on quarter, this shows that its gross profit margin increased due to cost and revenue, of which the rise in product prices contributed significantly

from the perspective of net profit margin, it was 6.68% in the first quarter of this year, an increase of 4.6 percentage points over the previous quarter, with a range of 221%, far exceeding the month on month increase of gross profit margin of 28.12%. This shows that the decrease of period expenses contributes a lot to the net profit. According to the data, the proportion of operating expenses and management expenses in operating revenue decreased significantly in the first quarter of this year compared with the previous quarter, with a decrease of 7.2% and 12.31% respectively, but the financial expenses increased by 19.38%

from the perspective of the industry, new chemical materials are increasingly used in the energy, environmental protection, energy conservation and high-tech aspects of Xintu automobile glove boxes, which are in line with the future development direction, also supported by policies, and have a good development prospect. But from the perspective of valuation, it is relatively high. The data shows that according to the first quarter performance of this year and excluding negative values with the overall method, the current P/E ratio of this sector is 44.85 times, while the A-share P/E ratio after deducting finance is 24.24 times, the former is about 85% higher than the latter (53.7% weekly with the TTM overall method). According to the historical P/E ratio (calculated weekly by TTM overall method) data since the beginning of 2003, the average premium rate of this sector to A-share P/E ratio after deducting finance is about 24%

however, due to its good prospect expectation, the market is still willing to give a higher valuation. It is suggested that investors can still pay attention to it after appropriate adjustment

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