\u3000\u3 Shengda Resources Co.Ltd(000603) 179 Jiangsu Xinquan Automotive Trim Co.Ltd(603179) )
The performance is basically in line with expectations. In 2021, the annual revenue was 4.613 billion yuan, a year-on-year increase of 25.3%, the net profit attributable to the parent was 284 million yuan, a year-on-year increase of 10.2%, and the net profit not attributable to the parent was 257 million yuan, a year-on-year increase of 3.9%; In the fourth quarter, the revenue was 1.349 billion yuan, an increase of 20.6% year-on-year and 34.6% month on month; The net profit attributable to the parent company was 64 million yuan, a year-on-year decrease of 28.6% and a month on month increase of 13.9%; Net profit deducted from non parent company was 67 million yuan, a year-on-year decrease of 22.2% and a month on month increase of 50.5%. In the fourth quarter, the year-on-year growth rate of the company’s profit was lower than that of its revenue, mainly due to the year-on-year decrease of 2.6 percentage points in gross profit margin and the sharp increase in R & D expenses on a month on month basis. The R & D expenses in the fourth quarter of 2021 were 76.196 million yuan, and the R & D expenses in the first to third quarters were 58.621 million yuan, 44.242 million yuan and 45.676 million yuan respectively. The R & D expenses in the fourth quarter increased by 119.8% year-on-year. In 2022, the company plans to pay a dividend of 0.3 yuan per share to shareholders.
The gross profit margin of the whole year and the fourth quarter was slightly under pressure, and the cash flow improved significantly. In the fourth quarter of 2021, the gross profit margin was 20.8%, a year-on-year decrease of 2.6 percentage points and a month on month increase of 2.1 percentage points; The annual gross profit margin was 21.3%, with a year-on-year decrease of 1.7 percentage points. The year-on-year decrease in gross profit margin is expected to be mainly due to the adjustment of the company’s product structure and the decline in the proportion of commercial vehicle revenue. During the whole year of 2021, the expense rate increased by 0.2 percentage points year-on-year, of which the R & D expense rate increased by 0.8 percentage points year-on-year, and the financial expense rate decreased by 0.6 percentage points year-on-year, mainly due to the increase of interest obtained from non-public offering of shares, the decrease of loans, the decrease of interest accrued from redemption of convertible bonds, etc. The net cash flow from operating activities in 2021 was 211 million yuan, with a significant year-on-year increase of 1425.9%, mainly due to the increase in cash received after the increase of business volume.
Actively expand new energy customers and supporting models. The company keeps up with the development of the new energy industry and actively develops new energy customers and models. In 2021, the company will realize the supporting of new energy vehicle projects under international well-known electric vehicle enterprises, Geely, great wall, SAIC, GAC new energy, Byd Company Limited(002594) , ideal, Weilai and other automobile enterprises. With the rapid development of the new energy vehicle industry, the company’s new energy business performance is expected to be further released, and the proportion of revenue and profit is expected to continue to increase.
Steadily promote the construction of Chinese and overseas production projects, implement the employee stock ownership plan, and establish an incentive and restraint mechanism. In 2021, the company will actively promote the construction of Xi’an and Shanghai production bases and Shanghai R & D center projects, which will improve the company’s production capacity and R & D innovation ability after reaching the production capacity; The company continued to promote the internationalization strategy. Based on the production bases in Malaysia and Mexico, the company established a wholly-owned subsidiary in the United States in 2021 and increased US $30 million to the Mexican subsidiary for base construction, so as to strengthen the supply and service capacity in the North American market. In October 2021, the company announced that it would launch the second phase of employee stock ownership plan, with a total scale of about 300 million yuan. The employee stock ownership plan will promote the company to establish a long-term incentive and restraint mechanism, align the interests of the company’s management and shareholders, and help improve the cohesion and management efficiency of the company’s employees.
Profit forecast and investment suggestions
Slightly adjust the income and gross profit margin, and it is estimated that eps1.5 will be in 20222024 52, 2.07 and 2.71 yuan (originally 1.56 and 2.24 yuan in 20222023). Based on the 22-year PE valuation and referring to the valuation of comparable companies, 30 times PE in 2022 and 45.6 yuan target price are given to maintain the buy rating.
Risk tips
The demand of passenger car industry is lower than expected, and the supporting quantity of passenger car and commercial vehicle products is lower than expected.
