\u3000\u3000 Snowsky Salt Industry Group Co.Ltd(600929) (600929)
The company is one of the leaders in China's salt industry. Its main products are all kinds of salt products including table salt, industrial salt and livestock salt, mirabilite, caustic soda, etc. In 2021, the company released the high-end sub brand "loose 997", and took the lead in putting forward the high-end strategy, with the high-end indicators of products gradually highlighted. The company has always focused on research and development, has reserved a variety of more mature production processes, and has been successfully applied to the production line, with significant technical advantages. In addition, the company is rich in salt cave resources. It has mining rights in four mining areas: Xiangheng salt chemical industry, Xiangli salt chemical industry, 1992 salt industry and Xiangyu salt chemical industry. It has strong resource advantages under the background that the State supports the development of comprehensive utilization and development of Salt Caves.
The "three transformations" have been steadily promoted, and the advantages of high-end products are remarkable: in 2017, China promoted the reform of the supply side structure of the salt industry, significantly stimulated the market vitality, and the company, as one of the leaders in the salt industry, gradually showed its profitability. While continuously enhancing the reserve of fixed-point production qualification of table salt, the company has always deepened the strategic goal of "three transformations", that is, from regional companies to national companies, from single well mineral salt to well mineral salt, sea salt and lake salt, from simple salt industry to salt industry chain cluster, and the leading position of the industry has been continuously improved. The company took the lead in putting forward the high-end strategy in the industry. In 2021, it released the "loose 997" high-end series, which has unique advantages in brine extraction water source and technical process. The purity of the product is far higher than the national high-grade edible salt standard. In addition, it also launched a series of flavoring salts such as low sodium salt, prebiotic salt and natural calcium salt to meet the special needs of different consumer groups, The competitiveness of products and the profitability of the company continued to improve.
Extend the salt chemical industry chain and complete the layout of "two bases": in addition to edible salt, the company continues to layout in the field of industrial salt and salt chemical industry. According to the announcement, the phase II caustic soda project and hydrogen peroxide project of 1992 salt industry have been completed and put into operation. At present, it has 300000 t / a caustic soda production capacity and 180000 T / a hydrogen peroxide production capacity. The circular economy development pattern of salt alkali cogeneration and cogeneration has gradually taken shape. In addition, in 2021, the company completed the acquisition of Xiangyu salinization and realized the layout of soda ash industry. Xiangyu salinization uses the combined alkali method to produce soda ash. At present, it has the production capacity of 700000 tons / year of soda ash and 700000 tons / year of ammonium chloride. At the same time, the coal gasification energy-saving technology upgrading and transformation project of synthetic ammonia section has been started in the first half of 2021 and will be fully put into operation in 2023, After the completion of production transformation, it is expected to have a production capacity of double 900000 tons / year, and the production scale is expected to continue to expand. Looking forward to the future, under the background of accelerating the development of downstream photovoltaic, lithium battery and other new energy industries, the soda ash industry is expected to enter a boom upward cycle driven by demand. With the continuous development of relevant businesses, the company is expected to fully benefit from the simultaneous increase of volume and price of soda ash products and realize the rapid improvement of profitability.
Investment suggestion: as one of the leaders in China's salt industry, while promoting the high-end of its products, the company continues to extend to downstream fields such as caustic soda and soda ash, and is expected to fully benefit from the development of salt chemical business and the improvement of its leading position in the future. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 402 million yuan, 490 million yuan and 568 million yuan respectively, and the company is rated as Buy-A investment.
Risk warning: the project construction is not as expected; Downstream demand is lower than expected; The implementation of the policy is less than expected
