Zhejiang Juhua Co.Ltd(600160) (600160)
Greatly expand PVDF production capacity, further open the high-end product market and maintain the company’s “buy” rating
On December 3, the company issued an announcement on fixed asset investment, which plans to invest 979 million yuan RMB 693 million will be used to construct “new 48kt / avdf technical transformation and expansion project” and “new 30kt / apvdf technical transformation and expansion project (phase I) and new 23.5kt/apvdf project” , the funds required for the project are the company’s own funds and self raised funds, which are expected to be completed and put into operation in the fourth quarter of 2023. After the completion of the above projects, it is expected to realize sales revenue of 781 million yuan and 2.128 billion yuan respectively. We are optimistic that the project planning will effectively give play to the advantages of the company’s industrial chain integration, technology and scale, increase the varieties of high-end and specialized PVDF products, and further open the high-end market. In view of the project construction needs a certain period, we maintain the profit forecast unchanged: it is estimated that from 2021 to 2023, the company’s net profit attributable to the parent company will be 837 million yuan, 1224 million yuan and 1847 million yuan respectively, EPS will be 0.31, 0.45 and 0.68 yuan / share respectively, and the corresponding PE of the current stock price will be 41.0, 28.0 and 18.6 times respectively, maintaining the “buy” rating.
The price of PVDF catalyzed by lithium battery has risen sharply, and a small amount of PVDF used by the company as lithium battery binder has been sold to the market
According to the data of Baichuan Yingfu, as of December 4, the prices of lithium battery binder, powder and granular PVDF were 415000 yuan / ton, 360000 yuan / ton and 325000 yuan / ton respectively, with an increase of 277.3%, 414.3% and 364.3% respectively over the beginning of the year; The price of PVDF raw material R142b was 185000 yuan / ton, an increase of 900% over the beginning of the year. The company now has a complete upstream and downstream industrial chain of VDC → R142b → VDF → PVDF, with obvious competitive advantages. Including: 20000 t / a R142b project has been completed and put into operation; The production capacity of VDC products ranks first in China, accounting for more than 50% of the Chinese market; 10000 t / a PVDF under construction has a capacity of 3500 T / A (emulsion method 2500 tons / year, suspension method 1000 tons / year), residual suspension method 6500 tons / year PVDF is expected to be completed in the first half of 2022. At present, the company levitation lithium battery binder has been sold to the market, emulsion technology, photovoltaic grade, injection molding grade PVDF technology is mature and reliable, and products are in short supply. The new 48 thousand ton / year VDF project of the company will support 80 thousand tons / year R142b; the new 23 thousand and 500 ton / year PVDF will be PVDF. The project will be produced by suspension polymerization process and emulsion polymerization process. Among them, the new suspension PVDF production capacity is 17 thousand and 500 tons / year. The new emulsion method PVDF production capacity of 6000 tons / year. It can be expected that PVDF for lithium battery grade binder of the company is only sold to the market, but it shows that the relevant technology of the company has been verified. In the future, after the company’s new projects are put into operation, similar products may be smoothly introduced into downstream high-end customers. At the same time, the integration advantages of the company’s industrial chain will be brought into full play and contribute considerable profit increment.
Risk tips: process technology risk, project construction progress is less than expected, and project profit is less than expected.
