Influence of the price rise of the hottest raw mat

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The impact of raw material price rise on Fuyao Glass

soda ash accounts for a relatively low proportion of Fuyao production cost. Since the beginning of the year, the price rise has been 22%, and the impact on the cost side of Fuyao Glass is expected to be less than 1%. Fuyaoxu 2 Sensor of metal tensile testing machine: the quality of the sensor determines the force measuring stability of the testing machine. The purchased raw materials mainly include energy cost (25.2%, natural gas, electricity, etc.), PVB membrane (13.4%), soda ash (5%), other raw and auxiliary materials (17.9%) ◆ cellenetm thermoplastic elastomer (TPE) particle series under colorite (collet)

the price of industrial natural gas fell steadily, and remained relatively stable on the whole. Due to the high monopoly and long-term cooperation, the price of PVB membrane has remained relatively stable. Soda ash has increased by 22.4% since the beginning of the year, but the comprehensive cost after conversion accounts for only 5%. At the same time, considering the impact of purchase price lock and other factors, the rise of soda ash price on the cost side of Fuyao is expected to be less than 1PCT

Fuyao's gross profit margin has historically been less affected by the price wave of raw materials, the tightening of preferential policies for traditional fuel vehicles and the relaxation of new energy vehicle policies. Product structure and capacity utilization are the core influencing factors of its gross profit margin. During the two rounds of raw material price hikes in history (year, year), Fuyao's gross profit margin has not been significantly impacted. The company's gross profit margin increased steadily in the year, which was mainly driven by the improvement of product structure. The annual decline was mainly due to the decline of capacity utilization. Looking forward to 2021, due to the recovery of the industry, the company's capacity utilization is expected to rebound significantly. Looking forward to the next five years, the penetration of new trends such as the canopy is expected to accelerate, and the company's product structure is expected to accelerate upward. Therefore, we judge that the company's gross profit margin is expected to continue to rise

labor + manufacturing costs account for a high proportion in the cost composition of the automotive glass industry. Fuyao has advantages over its competitors in cost control + refined management. It is expected that the company's global share will continue to expand. From the perspective of cost structure, in the field of auto parts, where labor cost + manufacturing cost accounts for a relatively high proportion, the market share of domestic leading companies is generally high. The internal reason is that labor cost control and scale advantage are often the competitive advantages of domestic enterprises. The labor cost + manufacturing cost of automotive glass accounts for a relatively high proportion in terms of industry attributes, which is what Fuyao is better at than its overseas competitors. Therefore, we believe that Fuyao will have a continuous cost advantage over its competitors, so as to realize the continuous expansion of global share

the impact of raw material price rise is limited. Triple inflection point + photovoltaic glass "option" firmly optimistic about the future development of the company and maintain the "buy" rating. We believe that the rise in the price of raw materials has a limited impact on the company. The subsequent new trends of glass (canopy, HUD, thermal insulation, coating, double-layer, etc.), especially the penetration speed of canopy, the reversal of trim business, and the operating leverage are expected to continue to exceed expectations. At the same time, with the superposition of photovoltaic glass "options", we are firmly optimistic about the future development of the company, maintain the annual return to parent net profit forecast of 4.11/52.4/6.15 billion, and maintain the "buy" rating

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