Huafang Textile Expects Yarn Prices To Rise About 50% Year-On-Year.

The company's existing low price cotton reserves are available until the end of the year, which ensures the company's performance this year.

The company's low price cotton comes from three channels: early market acquisition, auction of national cotton reserves, and Zhengzhou exchange futures contract.

In addition, the group has certain cotton reserves in Xinjiang. When the market is short of cotton, the group company will give the listed company certain support.

Since the beginning of this year, cotton, yarn, grey cloth, clothing and cotton products have been carried out along this industry chain.

The potential of lithium battery business is unlimited.

The company's lithium battery business is operated by Li Tian, a subsidiary of 70% of its holdings, and has a capacity of about 2 tens of hours / day.

At present, the company has fewer orders, the capacity can not be completely released, the operating rate is still not break even point, and it is still difficult to make profits this year.

In terms of market development, the company's products are still mainly used in the electric bicycle market, but the company's future goal is still aiming at the electric vehicle market.

The company has been in touch with some car manufacturers and other downstream customers.

We are optimistic about the company's future lithium battery business and expect to make profits next year.

In addition, the company also plans to add 7 battery production lines. If there is a breakthrough in market development, the future lithium battery business will have a relatively rapid growth.

Although the company's business accounts for a smaller share of the company's overall business and contributes less to the overall performance of the company, if future market development and capacity expansion go smoothly, it will have the potential to become the company's main source of profit in the next 3-5 years.

Electrolyte business began to make profits.

The company's electrolyte business is operated by Alex Hua Tian, a subsidiary company, holding 70% of the company, with 5000 tons / year of electrolyte production capacity.

In August, Alex Hua Tian has produced a small number of products for trial by downstream customers.

At present, the monthly output has exceeded the breakeven point, and it is expected to deliver about 450 tons by the end of this year.

Next year will be able to achieve full production status, will have a greater contribution to the company's performance.

In terms of performance, the company expects 2010-2012 years EPS to be 0.34, 0.63 and 0.75 yuan, of which the EPS of cotton textile business is 0.32, 0.40 and 0.45 yuan respectively, giving cotton spinning business 20 times PE in 2011, and cotton spinning business at a reasonable valuation of 8 yuan / share. The performance of lithium battery business is 0, 0.04 and 0 yuan. Considering the potential of the future growth of the business and the possibility of the company's increasing capital in the future, it can give the valuation of yuan / stock to the business. The performance of the lithium battery electrolyte business is respectively RMB, yuan and yuan. According to the 2011 earnings ratio, the value of the yuan / share can be given.