Powerful new material's announcement on August 1, plans to use the company's own money transfer is Mr Green photosensitive Yang Jinliang natural person shareholders holdings of 15 million yuan investment (which has contributed $12 million yuan, subscribed capital contribution of 3 million yuan), the transaction constitutes affiliate transaction, the transaction on the price of 12 million yuan, the transfer of subscribed capital contribution of 3 million yuan of value to 0 yuan, the company will continue to fulfill its obligations to the capital contribution), after the completion of the transfer of company will hold green photosensitive 10% stake, based on the transverse development UV light curing core technology - LED the market, performance is expected to form a new growth point. We maintain the forecast that the company's net profit for 2018-2020 will be 1.79, 2.32 and 280 million yuan respectively. According to the current total equity of 271 million shares, the corresponding EPS will be 0.66, 0.86 and 1.03 yuan respectively, maintaining the "overweight" rating.

Green photosensitive business focus on curing ink, coatings

Green photoreceptors was established in 2017. The actual controllers are Mr. Qian xiaochun and Ms. Guan jun (that is, the actual controller of strong new materials). The production base is located in changzhou, jiangsu province. Green photoreceptor has also established a joint research and development center for photoreceptor new materials in cooperation with the research institute, and owns 11 independent intellectual property rights. As of December 31, 2017, the company's net asset is 142 million yuan.

Uv-led products comply with the general trend of environmental protection and have a broad development prospect

Photosensitive building green environmental protection, according to changzhou eia network high-performance UV - 60000 tons/year LED based formula resin and pilot plant, the product is expected to locate FMCG printing and other fields, technology leading domestic level, and has obtained some key customer recognition, compared with solvent ink, coating (or water-based products), have significant environmental advantages; Compared with traditional UV curing products, LED curing technology can save significant cost in electricity and other aspects. Therefore, it has a good market prospect, and the follow-up is expected to be gradually extended to furniture, wood and other fields, with broad prospects.

Maintain an "overweight" rating

The company's traditional business photoresist maintained rapid development, OLED, IC and other high-end emerging materials sector layout continued to advance. We maintain the company's net profit in 2018-2020 were 1.79, 2.32, 280 million yuan of prediction (temporary not consider green light and table after the equity injection, we expect the green light is expected to be profitable next year), according to the current total share capital of 271 million shares, the corresponding EPS were 0.66, 0.86, 1.03 yuan, combined with comparable company valuations (guangxin materials business diversity, rejecting in 2018 after an average of 49 times), give the firm a 45-2018 48 times PE, corresponding target price 29.70 31.68 yuan, Maintain an "overweight" rating.