\u3000\u3000 Rongsheng Petro Chemical Co.Ltd(002493) (002493)
Performance review
The annual net profit of the parent company is expected to be RMB 13.371 billion from January 2023 to February 2023, with a year-on-year increase of RMB 12.53 billion, which is expected to belong to the parent company; The net profit deducted from non parent company was RMB 11.800-12.600 billion, with a year-on-year increase of 85.95-98.56%.
Business analysis
Zhejiang Petrochemical continues to release performance in phase I, and the operation of phase II is expected to continue to promote growth, with high performance and strong growth certainty. Zhejiang Petrochemical phase I was put into operation in December 2019. Considering the complexity of integrated devices, phase I project continued to promote performance growth in 2021. At the same time, Zhejiang Petrochemical phase II announced its full operation on January 13, 2022. Considering the load increase process of the unit after full operation and the solid conversion process after stable operation, as well as the complexity of the downstream bulk deep processing unit, we believe that the contribution of Zhejiang Petrochemical phase II will be small in 2021. With the gradual operation of the downstream bulk deep processing project of Zhejiang Petrochemical phase II, The performance of phase II is expected to be released gradually from 2022 to 2023, Rongsheng Petro Chemical Co.Ltd(002493) with strong certainty of performance growth.
Zhejiang Petrochemical’s profit may be much higher than expected: considering that the px-pta-polyester filament industrial chain of Rongsheng Petro Chemical Co.Ltd(002493) stock business is at the bottom of the boom in 2021 and the industry is generally at a loss, it can be deduced that almost most of the performance of Rongsheng Petro Chemical Co.Ltd(002493) 2021 comes from Zhejiang Petrochemical phase I. from the pre increase of performance, it can be inferred that the performance contributed by Zhejiang Petrochemical phase I alone can reach about 19-21 billion, or even higher, Zhejiang Petrochemical’s profit after fully reaching the production capacity may far exceed market expectations.
Large scale deep processing projects are arranged in the downstream of Zhejiang Petrochemical phase II project, which increases the added value of products and is expected to weaken the periodicity of performance: the downstream of Zhejiang Petrochemical phase II project is arranged with a large amount of new material deep processing projects, and the scale of chemical plants is larger than that of phase I, including a large amount of photovoltaic grade EVA, DMC, PC, ABS and other new materials widely used in photovoltaic, new energy vehicles and other new materials, Driven by the global “double carbon” policy, the end consumption demand of new energy related materials is high and the growth certainty is strong. The full operation of Zhejiang Petrochemical phase II project is expected to further weaken the Rongsheng Petro Chemical Co.Ltd(002493) performance periodicity.
Investment advice
As the second phase of Zhejiang Petrochemical is put into operation, Rongsheng Petro Chemical Co.Ltd(002493) has strong certainty of performance growth, and the added value of downstream end products continues to increase, we expect a net profit of RMB 12.9/198/22.3 billion from 2021 to 2023, corresponding to eps1.5 billion 3 / 1.96 / 2.2 yuan, corresponding to PE of 14.07x/9.18x/8.17x, maintaining the “buy” rating.
Risk tips
1. Risk of one-way large-scale decline in crude oil; 2. Serious terminal demand and deteriorating demand 3 Geopolitical risk 4 The construction progress of the project is less than expected Risk of large fluctuation of US dollar exchange rate 6 Other force majeure effects
