\u3000\u3000 Huaibei Mining Holdings Co.Ltd(600985) (600985)
Event: the company's holding subsidiary Inner Mongolia Eerduosi Resources Co.Ltd(600295) Chengda Mining Co., Ltd. received the reply of the national development and Reform Commission on the approval of taohutu coal mine project in nalinhe mining area, Inner Mongolia (fgy [2022] No. 267). In order to promote the construction of Shendong large coal base, ensure the stable supply of energy sources, optimize the coal industrial structure and agree to implement coal capacity replacement, Taohutu coal mine project in nalinhe mining area, Inner Mongolia will be constructed. The construction scale of taohutu coal mine is 8 million tons / year, and a coal preparation plant of the same scale will be built. The total investment of the project is 8.54 billion yuan (excluding the cost of mining rights), of which the capital is 2.669 billion yuan, accounting for 31.3% of the total investment, which is invested by the project unit with the enterprise's own funds; For the 5.871 billion yuan beyond the capital, apply for bank loans.
The company's resources continue to land, and the growth potential is worry free. According to the company's announcement on September 17, 2021, the company's 3 million T / a Xinhu coal mine was officially put into operation, and the company's capacity in property rights and interests increased by about 2.04 million T / A. It is expected that the mine can continue to contribute to the output increment in 2022. The approval of taohutu mine means that the equity production capacity of the company is expected to increase by 4.19 million tons / year (the company holds 51% equity of Chengda mining). During the "14th five year plan" period, the company's Zhuzhuang Coal Mine (with a production capacity of 1.6 million tons / year) may be shut down, but the construction of taohutu project is expected to further increase the potential of the company's main coal industry.
The demand for coking coal is expected to increase. Recently, due to the influence of the Spring Festival and the Winter Olympics, the production of downstream coking and steel industry is limited, and the operating rate remains low. With the Winter Olympics coming to an end, the output of steel and coke is expected to pick up, and the demand for coking coal will also recover. Meanwhile, under the background of "steady growth" in 2022, infrastructure investment is expected to rebound. Under this stimulus, the demand for coking coal is expected to increase in 2022.
The profit of gravel aggregate business is expected to grow. Lei mingkehua, a subsidiary of the company, has expanded the gravel aggregate business on the basis of the traditional civil explosion business. In recent years, with the tightening of environmental protection policies, the gravel aggregate market shows a pattern of short supply and high prices. At the same time, the infrastructure stimulation brought by "steady growth" is also expected to further stimulate the demand for gravel aggregate. The profit of the company's gravel aggregate business is expected to grow.
The transformation of the company has started. On December 27, 2021, the company announced that it plans to jointly invest with related parties to establish Huaibei Mining Holdings Co.Ltd(600985) Green Chemical New Materials Research Institute Co., Ltd., which is mainly used for the technical development of new materials, new energy and green chemical industry; Hydrogen energy, carbon capture and conversion, research and development and utilization of polymer materials and graphene materials; Research, development and utilization of products, processes and catalysts in the field of coal chemical industry, Shanghai Chlor-Alkali Chemical Co.Ltd(600618) and its industrial chain extension. The establishment of Chemical Research Institute will promote the transformation of the company's chemical industry to new materials and new energy.
Investment suggestion: as the current coal price exceeds our previous expectations, the profit forecast is raised. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 4.892 billion yuan, 5.253 billion yuan and 5.306 billion yuan, corresponding to EPS of 1.97/2.12/2.14 respectively, and PE of the share price on February 18, 2022 of 7 times, 6 times and 6 times respectively. The company has the growth potential that is scarce in the current sector, It is expected to obtain a higher valuation and maintain the "recommended" rating.
Risk tip: the coal price fell more than expected, the profit of newly put into production capacity was less than expected, the construction progress of newly approved capacity was slower than expected, and there was uncertainty in the project of Chemical Research Institute.
