\u3000\u3000 Zhefu Holding Group Co.Ltd(002266) (002266)
Net profit attributable to parent continued to grow significantly. On January 28, the company issued the announcement on the pre increase of performance in 2021. The net profit attributable to the parent company in 2021 is expected to reach 2.20 ~ 2.45 billion yuan, an increase of 61.5% ~ 79.9% compared with the same period of the previous year, and the net profit excluding non net profit is expected to increase by 84.1% ~ 105.1% year-on-year. The net profit attributable to the parent company in the fourth quarter of 2021 is expected to be 330 ~ 580 million yuan, an increase of – 43.3% ~ 0.2% year-on-year, EPS is expected to be 0.30 yuan / share in the same period of the previous year, and EPS is expected to increase to 0.41 ~ 0.46 yuan / share in 202.
Reasons for the substantial increase in performance. (1) The business of harmless treatment of hazardous waste and recycling of renewable resources has developed steadily, the sales volume has maintained growth, and the revenue level and profitability have increased significantly compared with the previous year; (2) With the continuous improvement of the industry and market scene of the clean energy equipment manufacturing industry, the company actively grasped the industry market opportunities, committed to continuously improving the technology R & D and manufacturing capacity, strengthened internal cost control, and the operating profit increased to a certain extent compared with the previous year; (3) In the business merger transaction under the same control formed by simultaneously issuing shares to controlling shareholders and third parties and paying cash to purchase the equity of Shenlian environmental protection group (including 40% equity of Shenneng solid waste), according to the relevant provisions of the accounting standards for business enterprises, the net profit realized by Shenlian environmental protection group from the beginning of 2020 to the merger date was included in the profit and loss of minority shareholders of the previous year of about 240 million yuan.
Under the background of “carbon neutralization”, focus on the recycling direction of hazardous wastes. With the tightening of supervision, the real demand for hazardous waste dumped and underreported in the past has been gradually released. The output of hazardous waste CAGR reached 16% in 2016-2019, with broad industry space and rapid growth. In addition, recycled metals can significantly reduce carbon emissions compared with primary metals. Under the background of “carbon neutralization” and circular economy, the recycling of hazardous wastes has great development prospects. The production capacity planning related to the material level of automobile lithium battery approved by the company through environmental impact assessment includes 15000 tons of refined nickel sulfate, 15000 tons of refined cobalt sulfate and 790 tons of lithium carbonate.
Asset restructuring helps transformation and welcomes the production capacity intensive launch period. Zhefu has arranged the whole industrial chain of hazardous wastes, covering from the front-end “collection storage harmless comprehensive treatment” to the back-end comprehensive recovery of polymetallic deep processing resources. The production capacity has increased from 510000 T / a at the end of 2019 to 1778000 T / a at the end of 2020. The business region and production capacity continue to expand. The production capacity of Taixing and Lanxi is climbing, and the future can be expected. In addition, the company launched a repurchase with an amount of no less than 150 million yuan and no more than 300 million yuan for the company’s later employee stock ownership plan or equity incentive plan to fully mobilize the enthusiasm of the company’s senior managers and core backbone personnel and promote the long-term development of the company.
Investment suggestion: after the completion of the company’s reorganization, a leading hazardous waste enterprise with the layout of the whole industrial chain has been formed. It has advanced technology, strong enrichment and recovery capacity of small metals, and obvious regional advantages in capacity layout. The capacity has been released intensively in the past two years. Under the background of stricter environmental supervision, it is worth looking forward to its future development. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 2.38/27.3/3.16 billion yuan and EPS will be 0.44/0.51/0.59 yuan respectively. The corresponding PE is 14.8x/12.9x/11.1x respectively. In addition, under the background of infrastructure development, the company’s traditional main business hopes to usher in new opportunities and maintain the “buy” rating.
Risk tips: 1. The macroeconomic downturn affects the supply of raw materials; 2. The production progress is not up to expectations.
