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　　 Sina tip: This is a research report column, which is only an analyst's personal views and opinions on a stock, not a formal news report. Sina does not guarantee its authenticity and objectivity. All effective information about the stock is subject to the announcement of the Shanghai and Shenzhen Stock Exchanges. Investors are respectfully advised to pay attention to the risks.

　　 Changjiang Securities Liu Yuanrui

Key points of the report:

Event description:

　　 Wuhan Iron & Steel The ex factory price policy of main products in February 2013 was announced. The main adjustment details are as follows: hot rolling: an increase of 200 yuan/ton. Plate rolling: remain unchanged. Cold plate coil: the ex factory price of common material series products such as DC01 and SPCC is increased by 150 yuan/ton; The ex factory price of steel for household appliances (including structural steel) will be increased by 80 yuan/ton; The ex factory prices of enamel steel, magnetic pole steel and weathering steel remain unchanged; The ex factory price of other products will be increased by 100 yuan/ton. Hot galvanizing: increase by 100 yuan/ton. Color coating: increase by 100 yuan/ton. Pickling: increase by 150 yuan/ton.

Tin plating: increase by 100 yuan/ton. Electrogalvanizing: the ex factory price of CQ grade products will be increased by 50 yuan/ton, and the ex factory price of other products will remain unchanged. Non oriented silicon steel: 1. Low grade: 50WW700 and below, the ex factory price of non oriented silicon steel is increased by 200 yuan/ton, and the ex factory price of other grades is increased by 150 yuan/ton; 2. Medium grade: increased by 200 yuan/ton; 3. High grade: the ex factory price of WHG-50 and 35WW270 will be increased by 150 yuan/ton, and the ex factory price of other grades will be increased by 100 yuan/ton. Oriented silicon steel: maintained unchanged. Wire rod: the ex factory price of ordinary carbon steel, fine carbon steel series (except S45C) and high carbon steel series (except W1055~1080) will be increased by 60 yuan/ton, and the ex factory price of cold heading steel series (except CH1T) and cord steel series will be increased by 100 yuan/ton. Profile: the ex factory prices of heavy rail, steel sheet pile and H-shaped steel products remain unchanged.

Event comment:

The ex factory price in February is expected to increase, and the increase is greater than that of Baosteel: the trend of adjustment of the ex factory price of mainstream products of the three major steel plants has always been relatively consistent. When Baosteel comprehensively raised the ex factory price of products in February, the company also chose to comprehensively adjust the ex factory price within expectations. This time, the factory prices of ordinary heating and cooling of the company increased more than those of Baosteel, which should be due to the relatively high cost pressure. In addition, the company continued to raise the price of non oriented silicon steel products this month under the condition that the domestic non oriented silicon steel continued to rise recently. The price difference between hot rolling and cold rolling has increased, and the absolute value is at a low level. The ex factory price rose slightly in January, and the performance in a single month was basically flat: after a simple calculation, the profit in February is expected to improve slightly compared with that in January, but the company's profit is still in a marginal state. Of course, our assumption simply considers the month on month changes of steel price and cost, which cannot fully simulate the changes in the actual business process, and may be different from the actual business data.

It is estimated that the company's EPS in 2012 and 2013 will be 0.03 yuan and 0.06 yuan respectively, maintaining the rating of "prudent recommendation".

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