Jinneng Holding Shanxi Coal Industry Co.Ltd(601001) (601001)
Gao Changxie has a steady profit and a platform for listing high-quality coal assets. Coverage for the first time, with a “buy” rating
As the leader of Shanxi power coal, the company is rich in coal resources and reserves. It maintains steady profits through a high proportion of long-term association, and its core competitiveness is remarkable. Benefiting from the national reform policy of Shanxi and relying on the newly established “energy aircraft carrier” Jinneng holding group, the company, as its only coal listing platform, has a clear strategic positioning, is expected to obtain further injection of high-quality coal assets, consolidate its leading position and have a large growth space in the future. We expect the net profit attributable to the parent company to be RMB 3.70/39.2/4.15 billion in 2021 / 2022 / 2023, with a year-on-year increase of 323% / 5.9% / 5.7%; EPS is 2.21/2.34/2.48 yuan; Corresponding to the latest share price, PE is 3.9 / 3.7 / 3.5 times. For the first time, give a “buy” rating.
Rich resources, significant location advantages, and a high proportion of Changxie’s profits are stable
The mining area is located in the power coal base with rich resources and leading production capacity. The company’s mines are distributed in Shanxi and Inner Mongolia power coal production bases. The coal seams in the coal field are stable and rich in high-quality power coal. The capacity of the holding mine reaches 32.1 million tons / year. Prominent location advantages and convenient transportation. The company is close to Beijing, Tianjin and Hebei and the Bohai economic circle, where industry is developed and energy is scarce, and has a broad energy supply market. At the same time, the company is located at the starting point of Daqin Railway Co.Ltd(601006) , and its coal products can go directly to Qinhuangdao port, the main hub port of China’s coal launching transportation. The convenient transportation conditions reduce the freight cost and shorten the supply time. The production and sales of coal are stable, and the high proportion of long-term association casts a steady profit. Benefiting from the industry supply reform, the company’s coal production and sales volume and production and sales rate recovered and remained stable at a high level. The company’s coal sold to the port adopts the long-term cooperation mode, locks in the price and stabilizes the fluctuation, and the company’s profit remains stable.
Power coal industry: tight supply creates a high boom in the industry, and the high coal price is conducive to the release of good performance
Since the fourth quarter, the policy of guaranteeing supply and limiting price has been strengthened. On the one hand, a large number of nuclear increased capacity have been approved to release the increment one after another, and the imbalance between supply and demand has been gradually alleviated. On the other hand, the intervention of the national development and Reform Commission in price limiting has led to a significant drop in the high coal prices at pits and ports. In the short term, the demand in peak winter season is expected to increase, and the fundamentals may still be based on tight supply, which can still support the high coal price within the scope of policy restrictions. In the medium and long term, the policy threshold for the approval of supply side coal mine projects will be raised, the incremental supplement of new capacity to coal supply in the next 2 ~ 3 years will be limited, and the potential space for capacity nuclear increase is limited; On the demand side, the steady growth trend of thermal power demand may not change during the 14th Five Year Plan period, providing support for the demand for thermal coal. The fundamentals may focus on tight balance, and the coal price center is still supported.
With the deepening of national reform and asset injection in Shanxi, there is more room for exogenous growth
The reform and development goal of Shanxi provincial enterprises in the 14th five year plan requires that the asset securitization rate of provincial enterprises reach more than 80%. Jinneng holding group gathers the high-quality coal resources of the original three major coal enterprises in Shanxi. It is the first coal enterprise in the province and the second largest coal enterprise in China. With strong strength, the company, as its only coal listing platform, has a clear positioning for the integration of coal resources. Jinneng Holding Shanxi Coal Industry Co.Ltd(601001) the asset securitization rate of the group is only 24%, and the coal production capacity securitization rate of Jinneng holding group is only 11%. In the future, the asset injection process may be accelerated, and the company has large exogenous growth space.
Risk tip: economic growth is lower than expected; Risk of falling coal prices; The progress of asset securitization is less than expected
