\u3000\u3 Guocheng Mining Co.Ltd(000688) 676 Hainan Jinpan Smart Technology Co.Ltd(688676) )
The revenue was + 36.3% and the net profit was + 1.2% year on year. The performance express was in line with our expectations. In 2021, the company achieved a revenue of 3.303 billion yuan, a year-on-year increase of + 36.3%; The net profit attributable to the parent company was 234 million yuan, a year-on-year increase of + 1.2%. The net profit attributable to the parent company excluding equity incentive expenses was 239 million yuan, a year-on-year increase of + 3.1%. The performance generally met our expectations. In 2021, although there were many dry changes, the downstream was booming and the production capacity was full, the sharp rise in the price of raw materials & export shipping squeezed the profits; Looking forward to 2022, under the cost plus mode, the price of early orders is renegotiated, and the bulk price trend is downward, and the profit side is expected to be repaired beyond expectations.
Wind power dry transformation penetration acceleration + high growth of optical storage connecting rod, new and old infrastructure flowering at many points, the company continues to increase capacity construction, and the capacity is expected to double by the end of 2022:
1) high benefit industries in the field of new energy β+ “1 to n” business expansion, segment revenue + 34% year-on-year. Wind power: benefiting from the development of large-scale wind turbine + sea wind, dry transformer replaces oil transformer with the advantages of lower system comprehensive cost, strong reliability and maintenance free. The product process barrier is high and the pattern is good. The company binds leading fan factories such as Vestas overseas + mainstream manufacturers such as Sany in China, which is expected to enjoy the high quality of the industry β。 We expect that wind power dry transformer series products are expected to maintain rapid growth from 2022 to 24. Photovoltaic: the company has expanded from silicon plant dry transformer to EPC, booster station supporting equipment and other businesses to achieve “1 to n” expansion. With the help of the high prosperity of the industry, we expect CAGR to maintain rapid growth from 2022 to 24. Energy storage: issue convertible bonds to raise funds to invest in Wuhan and Guilin energy storage plants, and realize the annual output of 1.2gwh/2.7gwh energy storage series products after reaching the production capacity. 2022 is the “first year” of starting volume, and Guilin plant is expected to be completed and put into operation, which is expected to achieve rapid development.
2) the sub sectors of infrastructure are booming and are expected to benefit from “steady growth” in 2022. The company’s revenue in infrastructure field in 2021 was + 79% (low base) year-on-year, and the structural performance of new infrastructure IDC, charging pile and other subdivided fields was also bright. In 2022, the downstream of infrastructure (traditional infrastructure, new infrastructure, housing, etc.) is expected to benefit from the “steady growth” policy. We expect the overall revenue growth rate to reach 20% +.
3) the digital chemical plant is externally enabled and has strong business continuity. In 2021, a contract of 132 million yuan (excluding tax) was signed with Eaglerise Electric & Electronic (China) Co.Ltd(002922) and it is expected that all revenue will be recognized in 2022, and the sustainability of digital business receipt is strong. Pay attention to the acquisition of subsequent orders.
Full orders are in hand, capacity continues to increase, delivery is guaranteed, digital quality and efficiency are improved. In 2020, the capacity utilization rates of dry-type transformer and dry-type reactor of the company were 99.67% and 94.74% respectively. The orders were full and the production capacity tended to be saturated. The raised investment of convertible bonds continued to increase the capacity construction of Wuhan factory. We expect that by the end of 2022, the total dry transformation capacity of the four major production bases in Haikou / Guilin / Wuhan / Shanghai will nearly double compared with the same period in 2020, and is expected to reach 50 million KVA +, supporting an output value of nearly 4 billion yuan.
Profit forecast and investment rating: as the impact of raw material price rise in 2021 slightly exceeded our expectations, we slightly adjusted the net profit attributable to the parent company in 202123 by 234 million yuan (- 20 million yuan), 369 million yuan (- 07 million yuan) and 530 million yuan (- 08 million yuan) respectively, with a year-on-year increase of + 1.2%, + 57.5% and + 43.7% respectively. The corresponding current price PE was 44x, 28x and 19x respectively, giving a target price of 30.45 yuan, Corresponding to 35 times PE in 2022, maintain the “buy” rating.
Risk tip: raw material price fluctuation, wind power dry-type transformer penetration is less than expected, capacity expansion is less than expected, competition intensifies, etc.
