Philip Morris International's IQOS e-cigarette will continue to grow at a high rate. As an IQOS precision plastic structural appearance developer, the company's performance will usher in an explosive growth. For the first time coverage, the "overweight" rating is given and the target price is 113.05 yuan.
For the first time coverage, the "overweight" rating is given and the target price is 113.05 yuan. The market is generally concerned about whether the high performance growth based on IQOS volume can be maintained, and we believe that the rapid increase in overseas HnB e-cigarette demand will superimpose IQOS in the US in 2018. The company's continuous increase in performance due to the heavy volume of e-cigarette components is extremely high. . It is estimated that the operating revenue for 2017-19 will be 30.50, 43.93, and 6.164 billion yuan respectively, and the net profit attributable to the mother will be 10.04, 14.72, and 2.181 billion yuan, corresponding to EPS 2.21, 3.23, and 4.79 yuan. Combining with the valuation of comparable listed companies, the target price will be RMB 113.05, corresponding to 35 times PE in 2018, and the “overweight” rating will be given for the first time.
The continued prosperity of the overseas electronic cigarette industry will become a guarantee for the continued growth of the company's performance. Benefits from: 1) Upgrading tobacco market consumption, increasing people's awareness of health, increasing awareness of the health hazards of tobacco; 2) Heating incompetent electronic cigarettes (HnB) is superior to traditional tobacco in terms of safety, health and taste; 3) The tightening of global tobacco regulation in the global market has led to a decline in sales of cigarettes; 4) Tobacco giants have purchased e-cigarette companies to use their global channels to promote e-cigarettes. In the next five years, the overall compound growth rate of HnB e-cigarettes has reached 50.42%. IQOS as an uncompetitive single product in HnB e-cigarettes, IQOS sales growth may continue to double.
IQOS is expected to be sold in the US in 2018. As a company that is deeply involved in the early development of IQOS appearance, IQOS will accelerate its growth. PMI submitted the pre-market inspection of IQOS to the US FDA in March 2017 and will be approved in 2018. As a country where electronic cigarette consumption accounts for 44.27% of the world's total, the strong purchasing power of the United States will continue to boost sales of IQOS in the United States. As a former joint developer of IQOS precision plastic structural parts, the company's performance will continue to grow rapidly.
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