PDF《公司动态》

1 to 14th Nov and a 100% cut from

15 Nov to

31 Dec and said this could extend to other regions. The impact of increasing environmental protection measures is expected to have an impact on the overall paper supply in China in Q4 2017. NDP management also highlighted that the Company was work- ing with the Tianjin government to generate power using both coal and natu- ral gas to improve overall emissions, which indicates that the leading players are the major beneficiaries of increasing environmental protection standards in China. The recent suspension of imports of unsorted waste paper and the delay in releasing dispatching licenses for imported waste paper have triggered a sharp rise in waste paper prices in China. Given the cur- rent environment, management believes that the industry ASP is un- likely to come down going forward as the current industry environment enables Chinese paper makers to raise prices and the trend might continue in Q4 2017. Management highlighted that packaging paper accounts for a small portion of end product selling prices, so custom- ers can fully absorb the recent increase in packaging paper prices. Our views. Despite limited sales volume growth, NDP'

s net profit growth in the coming years will be supported by better pricing, im- provements in efficiency and a reduction in interest expenses. Shares of NDP have performed well YTD, and we still believe that the industry environment remains favourable for Chinese paper makers, including NDP. NDP is looking for vertical integration expansion opportunities to drive medium- to long-term growth. Based on market consensus, NDP is now trading at 13.1X FY18 PER, which is below the average of its globally listed peers. It seems that the market has underestimated the growth potential of NDP. We believe that the earnings forecasts for NDP will be revised upward after its FY17 results announcement. Any post-results share price correction due to profit taking would provide a good re-visit opportunity. Catalysts. Paper price hike, more discipline on the supply side, and softening coal and waste paper prices. Figure 1: Peer Comparison Sources: Bloomberg, Company, CGIS Research estimates for covered stocks ;

*:Nine Dragons Paper'

s financial year ended in June 免责声明 此研究报告并非针对或意图被居于或位于某些司法管辖范围之任何人士或市民或实体作派发或使用,而在该等司法管辖范围内分发、发布、提供或使 用将会违反当地适用的法律或条例或会导致中国银河国际证券(香港)有限公司( 银河国际证券 )及/或其集团成员需在该司法管辖范围内作出注册 或领照之要求. 银河国际证券(中国银河国际金融控股有限公司附属公司之一)发行此报告(包括任何附载资料)予机构客户,并相信其资料来源都是可靠的,但不会对其 准确性、正确性或完整性作出(明示或默示)陈述或保证. 此报告不应被视为是一种报价、邀请或邀约购入或出售任何文中引述之证券.过往的表现不应被视为对未来的表现的一种指示或保证,及没有陈述或 保证,明示或默示,是为针对未来的表现而作出的.收取此报告之人士应明白及了解其投资目的及相........