\u3000\u3000 Sanxiang Advanced Materials Co.Ltd(603663) (603663)
As a leading enterprise in the zirconium industry, the development of double main industries opens up growth space: Sanxiang Advanced Materials Co.Ltd(603663) is the leader in China's electrofused zirconium and sponge zirconium industry. A number of zirconium series products of the company rank first in China in terms of production capacity and technology, and the profit contribution increases year by year. At the same time, the company also extended into the field of magnesium aluminum alloy, joined hands with Contemporary Amperex Technology Co.Limited(300750) to invest in magnesium aluminum alloy projects, and initially constructed the development pattern of "zirconium + magnesium" dual main industry.
The production capacity of traditional electrofusion zirconia business ranks in the forefront of the industry, with significant cost advantages. At present, fused zirconia is the largest business segment of the company, with operating revenue accounting for more than 50%. The annual production capacity of fused zirconia is about 26000 tons, ranking first in China. The company's production technology is leading, and its product purity ranks first in the world; The company has a wholly-owned subsidiary - yangmeizhou hydropower station, which has a significant advantage in power cost of fused zirconium production.
Optimize the product structure and strive to develop high value-added zirconium products. Through the acquisition of Liaoning huazirconium, the company entered the industrial sponge zirconium business and developed downstream products of fused zirconia; China's first "boiling fluorination" zirconium oxychloride production line invested and constructed by raising funds has entered the stage of equipment commissioning, with obvious advantages in cost and environmental protection; The company further arranged nano zirconia and special ceramics to enrich the product structure. So far, the company has built a relatively complete industrial chain in the field of zirconium products, is expected to form a good synergy, and focuses on developing zirconium processed products with high gross profit.
Join hands with Ningde to cut into magnesium aluminum alloy and open up a new business field. The company established Ningde Wenda magnesium aluminum Technology Co., Ltd. with several enterprises such as Contemporary Amperex Technology Co.Limited(300750) and Jiangsu Wanshun Electromechanical, with the company holding 35%. At present, the plant construction and die-casting equipment have been in place, and it is expected to be officially put into operation in the first quarter of this year. At present, Wenda magnesium aluminum products have obtained the confirmed order of Contemporary Amperex Technology Co.Limited(300750) battery pack structural parts. At the same time, it plans to enter the field of magnesium alloy building formwork and aluminum alloy lightweight ships. In the future, it is expected to open the company's long-term growth space with the help of magnesium aluminum new material business.
Investment suggestion: with the expansion of the company's production capacity of zirconium series products and the development of magnesium aluminum alloy business, the company's performance is expected to be released gradually. The company's operating revenue is expected to reach 1.228 billion yuan, 1.637 billion yuan and 2.082 billion yuan from 2021 to 2023, the net profit attributable to the parent company is 104 million yuan, 169 million yuan and 234 million yuan respectively, and the EPS is 49 million yuan, 0.79 million yuan and 1.09 million yuan respectively. Maintain the "buy" rating.
Risk tip: the global epidemic repeats again, the price of zircon sand continues to rise, the price of zirconium products decreases, and the progress of new production capacity is less than expected
