Wuhan Iron and Steel Industry Analysis

1, the company is located in the industry life cycle with the world's manufacturing sector to China and the transfer of the national steel industry policy and "support the strong and limit the poor" macro-control measures to implement, the next 3-5 years supply and demand is good, China's steel industry boom cycle is expected to continue. The strategic rise of the central and western part of the investment structure to improve and upgrade the consumption of steel demand growth will provide a broad market space for Wuhan Iron and Steel products. Wuhan Iron and Steel, in 2004, the realization of the steel industry as a whole after the elimination of backward production capacity, technological transformation, has now become the domestic steel industry, the pioneer of technological innovation and technological innovation of the pioneers, with the transformation of the traditional hot-rolled products to the deep processing, with a leading edge in the domestic quality of electrical steel, automotive plates, container plates, pipeline steel products, leading the quality of domestic technology, to become the leader of the high-end boutique products of the domestic steel; company In 2006, the company put into full production of the annual output of 2.15 million tons of two cold rolled mainly positioned in the high-end automotive plate. WISCO formed 2 million tons of production capacity in 2007, and the market share of car plate in 2010 increased to 20%. Relying on the new equipment, the company's target customers are mainly positioned in the domestic automobile manufacturers and large foreign automobile groups. Newly put into production two silicon steel 23 lines localization rate of 90%, which has more than 20 WISCO with independent intellectual property rights of technological innovation, WISCO silicon steel annual production capacity of 1.42 million tons. 2006 the second half of the new production line of the two cold rolled, two silicon steel, galvanized line and so on new production line gradually production, production equipment operating efficiency will be a big improvement in the product output amplification of scale effect will reduce the unit of fixed costs of products. Fixed costs of products, and thus in 2007 the gross margins of cold rolled and other new products will rise sharply; the company has and will form a comprehensive strength, will make WISCO's overall competitiveness (in the World Steel Dynamics WSD rankings) from 2005 ranked in the top 18 to enter the top 10.　The company's 2008 production and marketing scale from 10 million tons to 15 million tons of expansion in 2010 is expected to achieve 18 million tons, the next three years of production compound annual growth rate of about 20%, the next three years of earnings per share of about 33% compound growth rate, the short-term target price of 10.45-11.40 yuan, the long-term target price of 12 yuan raised to 15 yuan, to maintain a strong recommendation - A of the investment Rating. According to our calculations, the separable bond investment value is high; 2008 is the period of Wuhan Iron and Steel shares production growth. "Eleventh Five-Year Plan" project gradually put into production. 1.05 million tons of universal rolling mill will be put into operation in 2008, is expected to add 450,000 tons of heavy rail; capacity of 2.66 million tons of CSP production line will add 1 million tons of production; after the transformation of the rolling mill will also add 300,000 tons of production, the total amount of steel will rise from 10 million tons in 2006 and 2007 to 13.12 million tons, up from 10 million tons in 2006 and 2007. million tons to 13.12 million tons, an increase of more than 30% year-on-year. And with the two cold rolled, two silicon steel further down the line, the company's proportion of deep processing products will continue to improve; 2009 is the separable bonds to raise funds for the project hot rolling process successfully reached production in a year, on the one hand, can provide cold rolled raw material coils, on the other hand, can replace part of the cold rolled plate, to meet the market demand in full; high speed and heavy rail universal rolling mill put into operation will enable the company to benefit from China's railroad construction of pull; 09 years is also a separable bond project, the same as the project. The year is also separable bond project in the cold rolling process in the three cold rolled, three silicon steel production after the commissioning of the production rise year. With the gradual commissioning of the company's various processes, the company's cold rolling production line will be more reasonable division of labor, the product structure has been more effectively optimized, the entire scale and the proportion of deep processing will be across a new stage. 2, the industry's technological content of Wuhan Iron and Steel in the silicon-steel and other projects on the technical capabilities of the world's first-class domestic hegemony last year, the orientation of the silicon-steel has also got the first prize of the National Scientific and Technological Advancement Award. Wuhan Iron and Steel in the logistics cost of the relative disadvantage but formed a technical advantage. Non-oriented cold rolled silicon steel sheet is Wuhan Iron and Steel's "masterpiece", cold rolled grain-oriented silicon steel and high grade non-oriented silicon steel, only Wuhan Iron and Steel can produce. Wuhan Iron and Steel was put into operation in 2006, the second silicon steel plant of the localization rate of 90%, more than 20 independent intellectual property rights of the silicon steel technology innovation results have been used, it was put into operation, marking China's certain silicon steel production equipment and its products have reached the world's advanced level of production technology.　　　　　　　　　　　　　　　In recent years, Wuhan Iron and Steel around the construction of cold rolled silicon steel sheet, automobile plate, high-performance engineering structural steel three bases of the strategic objectives of the funds invested in scientific and technological innovation has increased dramatically year after year, only this year, the budget investment amounted to nearly 3 billion yuan. WISCO has been adhering to the "promotion of a generation, trial production of a generation, a generation of research, planning for a generation" of new products rolling research and development ideas, at present, there are more than 200 varieties in the industrial trial production. "National Silicon Steel Engineering and Technology Research Center" settled in WISCO, making WISCO become the first iron and steel enterprise with a national engineering and technology research center. Iron and steel enterprises are high energy-consuming and highly polluting industries. In recent years, WISCO is committed to energy saving, emission reduction and environmental protection, and the development of circular economy. It has invested more than 2 billion yuan in new blast furnace TRT and hot air flue gas waste heat recovery devices. At a cost of nearly 600 million yuan, the implementation of direct flow water to circulating water, significantly improving the industrial water recycling rate, reducing the water consumption of tons of steel. Investment of more than 200 million yuan of wastewater treatment and reuse project will be completed next year, WISCO's industrial wastewater will basically realize zero discharge. At present, WISCO blast furnace furnace coke ratio, coal injection ratio, utilization factor, process energy consumption are among the world's advanced level. Last year, WISCO recovered 6.1 million tons of steel slag, iron containing mud, fly ash and other solid waste materials, all of which realized resource utilization and achieved alternative value benefits of 1.447 billion yuan. WISCO insists on investing more than 10% each year to improve the overall level of environmental protection equipment. WISCO mine reclamation rate of 63.8%, of which the Daye iron ore has been reclaimed more than 4,000 acres of green, this has become a national geopark.