China Animal Husbandry (600195): Fundamentals and investment sentiment continue to improve opportunities

1H19 returns to mother’s net profit for ten years -15.杭州夜网论坛

65%, the performance is slightly better than expected China Animal Husbandry announced 1H19 results: 1H19 revenue18.

350,000 yuan, at least -3.

21%, net profit attributable to mother 1.

62 ppm, at least -15.


Revenue in the second quarter of 1910.

35 trillion, ten years +8.

22%, net profit attributable to mother 0.

74 trillion, ten years +9.

52%, performance is slightly better than market expectations.

Affected by the swine fever epidemic in Africa in 1H19, the pig breeding volume has been reduced and the profitability of breeding has been poor. The company’s sluggish demand for pig vaccines and veterinary drugs has dragged down performance and revenue, which has been expected by the market.

However, due to the high price of poultry, the company increased the sales of poultry vaccines and poultry medicine products, which supported the performance to some extent. This was the main reason for the company’s 1H19 performance to be slightly better than market expectations.

In terms of business, 1H19 biological products and veterinary drugs business performed poorly, and their revenues were 0.

9%, -15.

4%, gross profit margins were lower than -1.

5%, -2.

3%; feed business income is also affected by the decline in breeding volume, -12 a year.

5%, but gross margin rose by 5 in ten years.

1ppt, we judge that due to the high gross profit margin, the proportion of premix revenue increased and the cost of soybean meal decreased.

The overall profitability of the company was skipped in 1H19, and the gross profit margin was extended by 0 every time.

6ppt to 27.

7%, during which the expense ratio increased by 1.

3ppt to 22.

5%, net interest rate decreased by 1.

3% to 8.


The company is expected to be affected by the epidemic.
1Q3 performance may still decline every year.

Development trend 2H19 fundamentals have room for improvement: From historical experience, the inflection point of the company’s performance lags behind the inflection point of the pig price by about a quarter. When the pig price exceeds the full cost line, the decline in farming production narrows, and the performance of the companyInflection point.
In this cycle, although the pig price did not bottom out in 1Q19, due to the disturbance of the African swine fever epidemic, the decline in aquaculture production in July was still deepening.

Looking forward, we believe that the performance of the 2H19 auto insurance industry and the company may be better than 1H19. As the price of pigs rises, the profit of breeding companies will begin to release, and the cash flow of the auto insurance companies will have opportunities to improve;It is increasing, but large-scale breeding companies have begun to try to increase production in the northern region, which is also positive for animal sales.

African swine fever vaccine concept is good for company investment sentiment: market expectations for African swine fever vaccine are rising. From an industrial perspective, the current vaccine is still in the laboratory stage and there is no timetable. From the capital market perspective, it is expected that the first move will be driven by eventual catalysis.Corporate investment sentiment picked up.

Earnings forecast and forecast correspond to 29 / 26x P / E ratio of 2019/2020.

We maintain our Outperform rating and our 2019/2020 attributable net profit forecast4.


0 ppm, considering the expected improvement in fundamentals and the concept of African swine fever vaccine, there is room for repair in the sector. We raise our target price by 27% to 19.

00 yuan, the target price corresponds to 36/32 times the 2019/2020 estimate, + 23% space.
Risk Epidemics and policy risks; Company reforms and new product promotion are less than expected risks.