财务分析报告英文版

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1、CHINT ELECTRICS2011FINANCIALREPORTINGANDANALYSIS1Team Members：Liu ZhaoyeCommon-SizeWang YuyaoDebt-PayingXue JianchaoProfitability/OperationShen KangliangInvestment/OperationJiang RuiCompetitor/IntroductionLI xinCompetitor/Introduction2CHINT ELECTRICS Is Chinas largest production of low voltage elect

2、ric appliance manufacturing enterprise, the specialty is engaged in distribution appliances, control electric appliances, terminal apparatus, and power electronic and electric power supply low-voltage products development, production and sales. Chint is recognized for a famous Chinese trademark, chi

3、nt brand universal type circuit breaker, plastic shell type breaker series product has been awarded China famous brand product title. The company in 2004 won the Chinese quality management of the highest award, the national quality management award 3Company profile Stock name: CHINT ELECTRICS Stock

4、code: 601877lIs Chinas leading company in the field of low voltage electrical appliances lAdhere to the independent innovation, research and development a series of with independent intellectual property rights, reach the international advanced level of low voltage electric products lThe companys br

5、and to borrow Jacques realize from low voltage electrical supplier to solution provider change, so as to get higher gross margin and wide development space, the realization enterprise of in-depth development. 4The review of latest earningsThesaleswere82,880,000,000in2011,increasedto30.75%ofthe2010le

6、velin2011.Realizedearningsbeforeincometaxprovisionandinterestswere10,190,000,000.Anincreaseof24.70%.Thenetprofitwere8,430,000,000.Anincreaseof31.82%.Realized797millionnetprofitafterbuckle,increasedby31.16%.ThedilutedEPSis0.91.Duetothesignificantlydecreaseinmainrawmaterialcostprice,madethegrossearnin

7、gsratioincreaseto28.71%inthefourthquarter,increasedthegrossearningslevelt h r o u g h o u t t h e y e a r o b v i o u s l y 2 4 . 0 3 % 56Balance Sheet Vertical Common-size200920102011CurrentAssets：Monetarycapital36.79%62.16%52.11%Notesreceivable5.80%6.22%13.11%Accountsreceivable17.20%8.17%8.30%Adva

8、ncepayment2.23%1.84%0.80%Accountsreceivable-others0.35%0.22%0.12%Inventory17.36%10.92%10.29%Currentassets-others0.19%0.07%0.05%Totalcurrentassets79.93%89.60%84.79%Non-currentassets：Equity investment-long term2.23%1.00%5.09%Investment Property 0.14%0.06%0.04%Fixedassets13.27%5.63%4.58%Constructioninp

9、rocess0.31%0.98%2.48%Intangibleassets2.50%1.61%1.97%Deferredexpenses-longterm0.47%0.21%0.14%Deferredincometaxassets1.15%0.92%0.91%Totalnon-currentassets20.07%10.40%15.21%Totalassets:100.00%100.00%100.00%7Current liabilities：2009年2010年2011年Short-term borrowing0.05%0.00%0.01%Account payable33.93%19.63

10、%15.64%Account collected in advance1.49%0.79%0.84%Pay roll payable6.05%3.98%4.10%Tax payable1.22%0.38%0.74%Other payables4.82%2.92%2.58%Current liabilities-others0.75%0.55%0.29%Total current liability48.31%28.25%24.69%Non-current liability：Bonds payable0.00%0.00%17.83%Anticipation liabilities0.86%0.

11、50%0.48%Non-current liability-others0.00%0.07%0.09%Total non-current liability0.86%0.58%18.41%Total liability49.17%28.83%43.10%Owners equity：Paicl-up capital33.24%16.24%12.03%Capital reserve0.17%39.79%28.24%Surplus reserves3.45%2.56%2.98%Undistributed profits10.50%10.61%11.83%Total owners equityvest

12、 in parent company47.37%69.20%55.06%Minority equity3.45%1.97%1.84%Total owners equity50.83%71.17%56.90%Total liabilities and owners equity100.00%100.00%100.00%Balance Sheet Vertical Common-size8In 2011, the non-current liabilities item of company is theproportion of the 2010s increase obviously, mai

13、nly because thecompanyin2011toraisefundsforcompanyexecutedbondsissue1.5billionYuan.Fromthecurrentliabilitiestosee,thecompanysshorttermloanshasalwaysbeentheproportionisverylow，In2010thecompanyshort-termborrowingallpaidoff,in2011thecompanyonlyhadanincreaseof1.1millionYuanshort-termborrowing，Shouldsayt

14、hisbenefits from the company is very sufficient liquidity 。 Theproportionofaccountspayableislow,onthewhole,thecompanysshort-termdebtservicepressureisverylow.Balance Sheet Vertical Common-size Analysis9Balance Sheet Crosswise Common-size2009年2010年2011年CurrentAssets：Monetarycapital100.00%386.21%437.18

15、%Notesreceivable100.00%245.13%697.67%Accountsreceivable100.00%108.53%148.98%Advancepayment100.00%188.00%111.17%Accountsreceivable-others100.00%145.51%106.79%Inventory100.00%143.73%182.91%Currentassets-others100.00%91.20%86.33%Totalcurrentassets100.00%256.26%327.46%Non-currentassets：Equity investment

16、-long term100.00%102.77%704.53%Investment Property 100.00%90.25%80.50%Fixedassets100.00%96.89%106.56%Constructioninprocess100.00%725.53%2485.20%Intangibleassets100.00%146.79%242.62%Deferredexpenses-longterm100.00%104.57%94.24%Deferredincometaxassets100.00%183.21%246.14%Totalnon-currentassets100.00%1

17、18.47%233.96%Totalassets:100.00%228.60%308.69%10Current liabilities：2009年2010年2011年Short-term borrowing100.00%0.00%88.25%Account payable100.00%132.22%142.28%Account collected in advance100.00%122.04%173.41%Pay roll payable100.00%150.43%209.49%Tax payable100.00%71.01%187.52%Other payables100.00%138.5

18、6%165.18%Current liabilities-others100.00%166.88%121.18%Total current liability100.00%133.68%157.79%Non-current liability：Bonds payableAnticipation liabilities100.00%132.71%171.32%Non-current liability-othersTotal non-current liability100.00%152.50%6575.03%Total liability100.00%134.01%270.56%Owners

19、equity：Paicl-up capital100.00%111.67%111.67%Capital reserve100.00%52587.67%50395.17%Surplus reserves100.00%169.55%266.38%Undistributed profits100.00%231.01%347.70%Total owners equityvest in parent company100.00%333.93%358.81%Minority equity100.00%130.69%164.26%Total owners equity100.00%320.12%345.59

20、%Total liabilities and owners equity100.00%228.60%308.69%Balance Sheet Crosswise Common-size11Companysalesgrowthnotonlybroughtampleliquidity,moresubsequentreceivables.Accountsreceivable compared to above increase is not alot,butnotesreceivableisnearlyseventimesto2009.Theannualreporttomakeaexplained,

21、inorder to reduce the risk of bad loans, thecompanyadjustcreditpolicy,increasethesettlementscaleofbankacceptance.Balance Sheet Crosswise Common-size Analysis121.A long-term equity investment of 2011 years is 2009 7 times,mainlyduetothevalueof161.59millionYuanthiscompanytopurchasethe“ZKtechnology9.18

22、125millionshares,inadditiontothecompanyinvested200millionRMB.2.Theprojectunderconstructioncompanyin2011is2009yearsof24 times, mainly due to current period to raise funds basedconstructionprojectincausedbyincrease.3.The company non-current liabilities in 2011 is 2009 65 times,mainly because of the in

23、crease of bonds payable project, thatcompanywastoissue1.5billionbonds.4.Capital reserve in 2011 and 2010 were more than 500 times in2009,mainlybecauseofthecompany2010yearswasjustlisted.Balance Sheet Crosswise Common-size Analysis13Profits and Loss Items Crosswise Common-sizeItemsCrosswise2009Crosswi

24、se2010Crosswise2011NO.1、Taking100.00%132.02%172.62%Cut：Operatingcosts100.00%136.17%182.55%BusinessTaxesandSurcharges100.00%109.65%125.26%Sellingexpenses100.00%125.46%140.07%Managementexpenses100.00%135.57%161.47%FinancialExpense(Benegativeforthreeconsecutiveyears)100.00%185.99%1208.81%Lossfromassetd

25、evaluation100.00%-31.93%31.37%Incomeoninvestment(benegativein2009)100.00%-465.57%-872.47%NO.2、Operatingprofit100.00%119.65%155.06%Plus：Non-businessincome100.00%15.87%7.43%Cut：Non-businessexpenditure100.00%11.11%15.09%NO.3、Totalprofit100.00%121.88%156.36%Cut：Totalprofit100.00%116.61%142.94%NO.4、Netpr

26、ofit100.00%122.97%159.12%14ItemsVertical2009Vertical2010Vertical2011NO.1、Taking100.00%100.00%100.00%Cut：Operatingcosts71.84%74.09%75.97%BusinessTaxesandSurcharges0.65%0.54%0.48%Sellingexpenses5.05%4.80%4.10%Managementexpenses7.58%7.79%7.09%FinancialExpense(Benegativeforthreeconsecutiveyears)-0.11%-0

27、.15%-0.76%Lossfromassetdevaluation0.39%-0.09%0.07%Incomeoninvestment(benegativein2009)-0.01%0.04%0.05%NO.2、Operatingprofit14.59%13.22%13.11%Plus：Non-businessincome1.65%0.20%0.07%Cut：Non-businessexpenditure1.87%0.16%0.16%NO.3、Totalprofit14.37%13.26%13.01%Cut：Totalprofit2.45%2.17%2.03%NO.4、Netprofit11

28、.91%11.10%10.98%Profits and Loss Items Vertical Common-size15Profits and Loss Items Common-size AnalysisThe company business income in 2011 was 1.7 times than that in 2009, operating income increased year by year, explain the company sales scale expands unceasingly. The annual report says the compan

29、y mainly due to the increasing domestic and foreign market development and promotion of new strength, so domestic auxiliary market demand increase, sales volume growth.The company business cost 2011 is 1.8 times more than in 2009, operating costs increased year by year, and compared with the busines

30、s income greater proportion. This is mainly because 2011 product sales growth and raw material prices caused by common effect, but net profit in operating income proportion and not as a substantial increase in the sales increase, so the pressure of the rising costs was more.16 The financial cost thr

31、ee years are negative, suggests the company continued interest income were more than interest expenses and financial expenses in 2011 is 2009 of 12 times, annual report also shows that 2011 net interest revenue by two hundred and twenty percent more than at the beginning, because that does not exist

32、 is annual report has the controlling shareholders and their affiliates non-business take fund, then according to illustrate the annual report because the 2011 main source of revenue for the financial risk control increased cash reserves, interest income increase.Profits and Loss Items Common-size A

33、nalysis17Main Business Common-size18Main Business Common-size AnalysisWe can see that the power distribution, terminal and control electric appliance is the companys three big blockbuster products. Low voltage electric low end the market the main competitive factors is cost control ability and produ

34、ct prices, and the company with domestic similar enterprise brand advantage compared significantly, bargaining power, stronger, cost control ability outstanding, higher growth performance for many years the industry average more than 10% of the companys market share increases company experienced ind

35、ustry inside remain relatively high growth.19analyses of short-term debt-paying abilitycomparisons between some ratios of recent 3 yearscomparisons between some ratios of recent 3 years yearyearratioratioyear2009year2009year2010year2010year2011year2011Working Working capitalcapital856018150.38560181

36、50.3yuanyuan 36979044213697904421yuanyuan50221431635022143163yuanyuan current current ratioratio1.651.653.123.123.433.43Acid-test Acid-test ratioratio1.301.302.732.733.023.02 cash ratiocash ratio0.760.762.202.202.112.11net cash net cash provided by provided by operating operating activities/curactiv

37、ities/current rent liabilitiesliabilities0.840.840.400.400.060.0621Analyses of Working CapitalAswecanseefromthechart，thiscompanysworkingcapitalhasbeenpositiveandgraduallyincreasedrecently，becausetherecent3yearscurrentassetsandliabilitieshavegraduallyincreasedrespectively，andthedifferencebetweenthese

38、twohavealsoincreased;thisdifferenceistheworkingcapital.Thisincreaseintheworkingcapitalindicatesthatthecompanysshort-termdebt-payingabilityisguaranteed，andstrengthenedrecently。22Analyses of Current Ratio Aswecanseefromthechart，thiscompanyscurrentratiohasbeenpositiveandgraduallyincreasedrecently，becau

39、sethecurrentassentsandcurrentliabilitieshavegraduallyincreased,butthecurrentassetshaveincreasedfaster.Theincreaseofcurrentratioindicatesthatthecompanyhasagrowingabilitytopaythecurrentliabilities,andtheshort-termdebt-payingabilityhasstrengthened.23Analyses of Acid-test RatioAswecanseefromthechart，the

40、companysacid-testratiohasgraduallyincreasedrecently，becausethecurrentassetsandinventorieshavebothincreasedbutthecurrentassetshaveincreasedmuchfaster,whichmadethedifferencebetweenthemincrease.Theincreaseintheacid-testratioindicatesthatthecompanyhasagrowingabilitytoimmediatelyrealizeandpayshort-termli

41、abilities.Atthesametime,thistendencyisconsistentwiththecurrentratiostendency,whichmeansthatthecompanysinventorieshavebeenstablerecent.24Analyses of Cash Ratio Aswecanseefromthechart，thecompanysyear2011scashratiosismuchbiggerthanyear2009s，buttheyear2011sisslightlysmallerthantheyears.Becausethecashequ

42、ivalentsgrewmuchfasterthanthecurrentliabilities,causingtheirratiotoincrease.Astoyear2011and2010,thecashequivalentsandthecurrentliabilitieshavebothincreasedbuttheirratioshavealittledifference.Thetendencyincashratioindicatesthatthecompanysabilitytopayimmediatelyhasincreasedenormouslyanddecreasedabit.2

43、5Analyses of Net Cash Provided by Operating Analyses of Net Cash Provided by Operating Activities/Current LiabilitiesActivities/Current LiabilitiesAswecanseefromthechart，thecompanysnetcashprovidedbyoperatingactivities/currentliabilitieshasgraduallyincreased,becausethenetcashprovidedbyoperatingactivi

44、tieshavedecreasedandthecurrentliabilitieshaveincreased,causingtheirratiotodecrease.Thisratiostendencyindicatesthatthecompanyhasagraduallydecreasedabilitytopayitsshort-termdebtsbyusingnetcash.Thisratiointherecent3yearshasbeenbelow1,sothecompanycantpayitsdebtusingjustnetcashprovidedbyoperatingactiviti

45、es.Itmustobtaincashinotherwaystoensurethatitsliabilitiescanbepaidintime.26 analysesoflong-termdebt-payingability comparisons between some ratios of recent 3 yearscomparisons between some ratios of recent 3 yearsyearyearratioratioyear2009year2009year2010year2010year2011year2011 debt ratiodebt ratio49

46、.17%49.17%29.30%29.30%43.10%43.10%debt/equity debt/equity ratioratio96.75%96.75%41.44%41.44%75.74%75.74%Debt to Debt to tangible net tangible net worth ratio worth ratio 101.76%101.76%42.42%42.42%78.46%78.46%Times interest Times interest earnedearned532.02532.021820.801820.8026.4426.44net cash net c

47、ash provided by provided by operating operating activities/totactivities/total liabilitiesal liabilities0.830.830.390.390.030.0328 analyses of debt ratio Aswecanseefromthechart，thecompanys2010yearsdebtratioismuchsmallerthanthe2009s,becausethetotalassetsofyear2010ismuchbiggerthantheyear2009.Thedebtra

48、tioofyear2011isnearlylevelwiththeyear2009,becausealthoughthetotalassetsandliabilitieshavebothincreased，butaswithyear2009，thetotalliabilitiesarenearlyhalfofthetotalassets.Theoretically，intherecent3years,thecompanyhasagrowingandthendecreasingdebtburden.However,theseratiosareallbelow50%，whichcanbeconsi

49、deredacceptableandmeansthatthecompanyhasacomparativelylightdebtburdenandthecreditorsinterestsarehighlyprotected.29Analysesofdebt/equityratioandDebttotangiblenetworthratio Aswecanseefromthechart，thesetworatioshavebothdecreasedandincreasedrecently.Becausecomparedwiththetotalownersequity,thetotalintang

50、ibleassetsandliabilitiesaremuchsmaller,thereasonsforthistendencyarealmostthesame，thatis,theyear2010stotalequityismuchbiggerthantheyear2009s。Howevertheyear2011stotalequityandliabilitiesandtheyear2009scanbenearlyconsideredthesame.30AnalysesofTimesinterestearnedAswecanseefromthechart,thecompanystimesin

51、terestearnedhasfluctuatedenormouslyrecently.Itincreasedenormouslyfromyear2009to2010,anddecreasedenormouslyfromyear2010to2011.Thereasonisthatcomparedwithyear2009,theyear2010snetprofitandtaxexpensehavebothincreased,butinterestexpensehasdecreasedenormously,causingtheratioofthetotalofthesethreeandintere

52、stexpensetoincrease.Besides,comparedwiththeyear2010,theyear2011snetprofitandtaxexpensehavebothincreased,butinterestexpensehasdecreasedmoreenormously,causingtheratioofthetotalofthesethreeandinterestexpensetodecrease.Ascanbeknown,thefluctuationofinterestexpenseisthemainreasonforthefluctuationoftimesin

53、terestearned.Althoughthetimesinterestearnedfluctuatedmuch,thesefiguresindicatethatthecompanyhasaconsiderableabilitytopaytheinterestdebtandlong-termdebt-payingability.31AnalysesofNetCashProvidedbyOperatingActivities/TotalLiabilities Aswecanseefromthechart，thisratiohasdecreasedrecently,becausethenetca

54、shprovidedbyoperatingactivitieshavedecreasedandthetotalliabilitieshaveincreased,causingtheratioofthesetwotodecrease.Thisratiosdecreasingtendencyindicatesthatthecompanyhasadecreasingabilitytopayitsdebtsusingthenetcashprovidedbyoperatingactivities.Thefiguresoftherecent3yearsareallbelow1,sothecompanyca

55、ntpayitsdebtsusingjustthenetcashprovidedbyoperatingactivities.32Thesummaryofanalysesofdebt-payingabilityAswecanseefromtheanalysesfrom,thecompanysabilitytopayliabilitieshasbeengrowingdecently,especiallybetweenyear2009and2010.Althoughithasundergonesomefluctuationsinsomeratios,thesechangescanbeconsider

56、edthechangesthatdontinfluencethedebt-payingabilitymuch.Thesetrendsalsoconformtotheappliancesindustrialdevelopment.Becauseofsuchfactorsasnationalpolicyandgrowingeconomicdevelopment,thehomeappliance,thecompanyhasbeendevelopingrapidly.However,accordingtosomeratios,thecompanystillhassomethingtoimprove.3

57、3 Operation Capacity Analysis34Item200920102011Accounts Receivable Turnover 9.9712.7713.55Day Sales in Receivable36.1128.1926.57Inventory Turnover 7.178.028.06Inventory Turnover in Days50.2144.8944.67Fixed Assets Turnover12.6217.5322.22Total Assets Turnover2.561.441.15Operational capability index co

58、ntrast35Accordingtoanalyzetheindexofoperationcapability,accountreceivableturnoverwentupyearbyyear.Itexplainedthatthegrowthrateofnetsalesexceededgrowthrateofaccountreceivable.Themainreasonthatrapidgrowthofsalesincomeleadtoincreasingaccountreceivable.InordertoreduceBaddebtriskofCHNT,CHNTproperlyadjust

59、creditpolicyandincreasethescaleof settlement the bank acceptance. Because of increasing account receivable turnover, CHNT received much cash and Loss on bad debts reduced. CHNT has great debit paying ability.36inventory turnover ratio also increased year by year. It illustrated that the increasing e

60、xtend of cost of sale overweight increasing inventory. It also showed that the occupation of the inventory level of CHNT was low and had highly liquidity. Moreover, the more highly liquidity, the more fast the speed of inventory converting to cash and account receivable. CHNTsfixedassetturnoverwasin

61、creasing.Itshowedtheutilization of fixed asset of CHNThadbecomehigherandhigherandthemanagementlevelconstantlyimproved.Meanwhile,ithasadvantageforimprovingCHNTsprofitability.37However, the total asset turnover has decreased year by year. Total asset turnover is an important indicator to examine the o

62、perational efficiency of corporate assets, reflecting the transfer speed of all of the assets of the business during the period from input to output. The possible reason lies in the companys long-term equity investments, intangible assets and construction in progress. Owing to a significant increase

63、 in long-term equity investments, intangible assets and construction in progress, it leads to the increase in total assets is greater than the increase in net sales. The actual situation, confirmed the speculation. The company purchase a low voltage electric appliance industry base. This move led to

64、 a significant increase in long-term equity investment. Due to newly acquired Wenzhou electrical, net sales growth was slower than the growth of total assets. At the same time, Zhejiang Zhengtai Corporations total asset turnover is still far higher than the industry total asset ratio. It proved that

65、 the company operates well.38 Profitability Analysis39Item200920102011Net Profit Margin11.9111.1010.98Total Asset Turnover2.061.441.15Return on Assets 24.3116.0112.51Operating Income Margin14.9913.1013.12Operating Asset Turnover2.161.501.23Return on Operating Assets32.2919.6816.07Dupont return on as

66、sets31.3116.3612.88 Fixed Assets Turnover12.6217.5322.22Return on Total Equity41.5716.3519.14Gross Profit Margin27.5125.3723.55Profitability index contrast40 Compared with 2009, we found that the equity return rate changes a lot in 2011. Through the analysis of financial statements, we found the com

67、pany owners equity increases by 220.12%. Owners equity greatly increased, leading to rights return rate drop dramatically. The reason why the owners equity has a big increase is that the company becomes a public company in 2010. But compared with 2010, the owners equity increased by 7.96% in 2011. I

68、t is clear that the growth is not obvious. Whats more, net income increase.41Combined with the practical situation, we found that the company five main products gross margin have a certain scope down, but change is not clear. Combined with practical, we learn that terminal apparatus and power to the

69、 electric gross margin fell more than 3%. The reason why gross profit decrease is that the copper, silver and other main raw material prices rise, reducing product profit margins. But the company during the good cost control, marketing expenses, administrative expenses and financial expenses drop re

70、spectively compared to the 0.7, 0.69 and 0.44%, to make up for the rise in the cost of raw materials to the company net profit margin of the influence42Operating return on assets decreased significantly, thus further reflecting the efficiency of asset utilization.Compared with 2009, Operating return

71、 on assets decreased significantly in 2010. Analysis the reason is that a large number of operating costs and notes receivable, notes receivable increased by 145.13% ,compared with 2009. compared to 2009, operating costs increased by 136.17%. The increase in notes receivable cause increase of the op

72、erating assets, increased operating costs led to a decrease in operating income. In the end, lead to the decline in operating return on assets.43The reason why return on assets decline is that the growth of total assets higher than the net income growth. Analyzing the reasons for the growth of total

73、 assets is the long-term equity investment, construction in progress as well as the growth of intangible assets. Compared with the beginning of the period, the long-term equity investment increased by 585.52%. Compared with the beginning of the period , the construction in progress increased by 242.

74、54. compared with the beginning of the period, the intangible assets increased by 65.28%.44Investmentabilityanalysis45Item2009CHNT2010CHNT2011CHNTFinancial Leverage1.00 1.00 1.04 Market Value Per Share（yuan）-23.95 13.10 EPS（yuan）0.58 0.64 0.82 Price/Earning Ratio%-37.42 15.96 Retained Earnings Ratio

75、 %65.52 31.5014.63 Dividend Payout Ratio%34.4862.5085.37Dividend Yield%-1.67 5.34 Book Value Per Share (yuan)1.42 4.20 4.58 Cash Flow Enabling Investments Earnings Per Share1.23 0.69 0.12 Operating cash flow enabling investments/cash dividend5.49 1.70 0.17 Comparingtheabilityofinvestmentfrom2009to20

76、1146According to these related index, we can found that the CHNTs financial leverage basically maintain at 1.00 and keep stably low level. It show that the CHNT has lower risk of finance. CHNT has just listed in 2010. The listing of price of the CHNT in 2010 abidingly dropped from 23.95 yuan to 13.1

77、0 yuan in 2011. We can have a proof that it was affected by the European debt crisis. Because of that, the big board of Shanghai Index dropped badly and also affected market value per share of CHNT. The EPS of CHNT raised year by year. Comparing with last two years, it increased 10.34% and 28.13% re

78、spectively. It explain that CHNTs profit also enhanced year by year.The price/earning ratio reflect the relationship of the common market value(MV) between current EPS. However , we can find something in the table that the P/E fallen from 37.42%to 15.36%. Although it has dropped 21.46%, we should co

79、mprehend the depreciation extend of MV overweigh the increasing extend of EPS and finally lead to the decreasing of P/E ratio. Nevertheless, the development potential of CHNT will have good future.47From the data of dividend payout ratio, CHNT has higher dividend payout ratio. It increased year by y

80、ear. In 2011,dividend payout ratio has dramatically had 85.37%. The reason that company has always kept stably and rapidly in recent years. According the latest announcement of dividend distribution, it will assign 0.7 yuan per share. CHNTs dividend in last year had 402 million yuan. Dividend in thi

81、s year largely overweigh last year. It has 704 million yuan and dividend pay out ratio was 85.37%. However, dividend payment rate will lead to the rise of retained earnings decline. We can obviously find these data in this three years . Higher dividend payout ratio showed that CHNT will honestly rew

82、ard every investors. Dividend yield and book value per share both increased obviously from 2009 to 2011 ,it illustrate that profitability of CHNT has continuously grew and operation situation will beGenerally speaking, the share of CHNT has largely appreciation potential. The investor can buy or ove

83、rweight these share.48Compared with competitors chintvssenyuan49Contrast BackgroundpSenyuan Electric smaller than Chint ElectricspSenyuan listed stock that is development well from February in 2010 pThe main job for Chint is low-voltage electrical business, the power distribution equipment is Senyua

84、ns main work.pThe Chint popularity spread throughout the country even abroad, and the development is more perfect . Senyuan Electric has a certain reputation in the province, so coverage is limited.50Operating capacityprojectChint in 2011Senyuan in 2011Days sales in receivables times per period13.55

85、3.11Accounts receivable turnover days26.57115.76Inventory turnover time per period8.064.54Days sales in Inventory days44.6779.30Fixed asset turnover22.225.71Total asset turnover1.150.5351InthereceivableareaChintappearstobeaheadofSenyuan.Thedayssalesinreceivableturnoverislonger,thatexplainSenyuanhasb

86、adcapableofcallbackmoney.Thereasonmaybehavetwo:usetoomuchinstallmentplanandsaleswithusemuchmoneytoclosetheaccount.IntheinventoryareaChintappearstobeaheadofSenyuan.Mainlybecausethesalesrevenueincreasefast,accountreceivableincreasesame.Thecompanyneedtoreducetheriskofbaddebtsbyadjustthecreditpolicetoin

87、creasescalesofexchange.InthefixedassetareaChintislargerthanSenyuan.Chinthasbettermanagelevelandhashigheruseratio.InthetotalassetareaChintishigherthanSenyuan.Chinthasbettercapableofsales,andbetteruseratioofasset.Operating capacity52Short-term debt-paying abilityprojectChint in 2011Senyuan in 2011Work

88、ing capital5,022,143,163718,567,385Current ratio3.432.44Acid-test ratio3.022.198Cash ratio2.111.20653 Chint has much higher current ratio, acid-teat ratio, and cash ratio than these ratios for Senyuan. The higher current ratio explain the company has stronger ability in short-term debt-paying, the g

89、uideline for the minimun current ratio has been 2 for creative company, because they has a lots of inventory that has bad liquidity. But the higher current ratio maybe is not a good sign, because it state the company have lots of money in current asset ,they can not use this validity, its may effect

90、 the profitability.The acid-test ratio of two company is more than 1, that because too much account receivables led the ratio go high.The cash ratio of Chint is higher than Senyuan. The higher cash ratio reflect the good debt-paying ability. But this also reflect the company has too much cash equiva

91、lents . The company always maintain the asset with money form, and can not use the assets properly.Short-term debt-paying ability 54projectChint in 2011Senyuan in 2011Debt ratio 43.1033.54Debt/equity75.7450.46Debt to tangible net worth78.4651.92Times interest earned26.447.31Operating cash flow/total

92、 debt312.41Long-term debt-paying ability55ProfitabilityprojectChint in 2011Senyuan in 2011Net profit margin 11.2016.38Total asset turnover 1.150.526Return on assets12.519.68Operating income margin13.1119.16Operating asset turnover1.1940.55Return on operating assets13.1210.53Gross profit margin24.033

93、2.7156Profitable MeasuresChintishigherthantheSenyuaninReturnonassets,OperatingassetturnoverandReturnonoperatingassets,whichexplainthatchintsassetsutilizationefficiencyishigher,andenterprisesachievedgoodeffectinincreasingrevenue,moneysaving.Itismuchbetterinefficiencymanagementandabilitytoutilizeitsas

94、setstocreateprofitsmuchhigherthansenyuan,notonlylargescale,themanagementalsokeepup.Thehighlyoperatingmarginshowsthattheenterprisemarketcompetitivenessisstronger,thegreaterpotentialdevelopment,thestrongertheprofitability.ThehigherReturnonoperatingassetsexplainsthatthemanagementactivitiesmoreefficient

95、,Andthenetprofitmarginsandgrossprofitmarginchintarelowerthansenyuanthatisithasahighercost.Soifitwanttoimprovenetprofitmarginandgrossprofitmarginshouldreducethecost.Senyuansprofitmarginsandmanagementinnetprofitmargins,grossprofitmarginmuchhighthanchint,showsthatitsprofitabilityincreasebigcompanieshig

96、hergrossmarginofnewproductsalesincomeintheproportionofthecompanysrevenueshaveincreasedgreatly,furtherimprovethecompanyprofitability,enhancethecompanysoverallcompetitivepower,forthecontinuedgrowthofthecompanysmanageachievementprovidethesafeguard.57Investor analysisProjectChint in 2011Senyuan in 2011D

97、egree of financial leverage 1.041.16Earning per share0.820.76Price/earnings ratio15.9629.71Percentage of earnings retained45.8859.6Dividend yield54.1229.41Dividend payout5.340.99Book value per share4.585.7Operating cash flow per share0.120.3658Investment analysisTwocompaniesdegreeoffinancialleverage

98、isrelativelysmall,canaddproperdebt,makefulluseoffinancialleverage.Chintsearningspersharehigherthansenyuan,explainitsprofitabilitybetterthansenyuan.Senyuanelectricp/eratioishigherthanchintthatmarkettothecompanymorevalue,investorswillingtospendthehigherpricetobuythecompanystock,butalsomeansthatithaveh

99、igherrisk.Senyuanpercentageofearningsretainedarehigherthanchint,itsareingrowingup,willneedalotofmoneytodevelopment.Thedividendpaymentratechintishigherthansenyuanthatshareholdersenjoymorethanshareoutbonus,toacertainextent,reflecttheenterprisesprofitabilityisgood,toinvestor,highdividendpaymentrateinev

100、itableisagoodthing,butshort-termdividendpaymentrateislow,themoneymaybeleftanddevelopmentcompany,maycreatemorevalue.ChintsOperatingcashflowpersharebelowsenyuan,explaintheoperationabilitybynowchintremaintobeimproved. 59Prediction and advice grossprofitmarginrisein2012Themainrawmaterialsascopper,silver

101、,suchasplasticparticles,rawmaterialpurchasecostaccountingfortheproportionofthetotalcostoftheproductisabout50%.Wethinkthefuturepriceofsilverandcopperpricesareexpectedtocontinuetodecline.Consideringthecompanyfromordertodeliveryoftheproductioncycleisshort,thefuturepriceofsilverandcopperpricesfellto2012

102、thecompanyprofitmarginswillformthebeneficialeffects.Consistentlyhighshareoutbonuspolicythecompanyshalltakehighshareoutbonusdividendpolicyin2009,2010includingbythemiddleof2009270millionyuan,annualcashdividendscashdividendsattheendofthe201millionyuan;In2010thecompanydividendsratioreached62.9%.Adheretoscientificandtechnologicalinnovation,makehigh-endbrandTheprojectsmainJacquesinhigh-endmarketfuturewillbecomeanimportantcompanyprofitgrowthengine.60