\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Key investment points
Event 1: disclosure of performance express. The company disclosed the annual performance express in 2021. The company expects to achieve an operating revenue of 31.87 billion yuan in 2021, a year-on-year increase of + 47.64%; The net profit attributable to the parent company was 2.941 billion yuan, a year-on-year increase of + 50.56%.
The performance is in line with market expectations, and the profitability is expected to bottom out. The company's performance express is within the performance forecast range, which is in line with market expectations. Among them, 2021q4 achieved an operating revenue of 8.160 billion yuan, a year-on-year increase of + 37.14% and a month on month increase of + 3.26%; The net profit attributable to the parent company was 172 million yuan, with a year-on-year increase of - 69.84% and a month on month increase of - 67.93%. The net profit margin attributable to the parent company in 2021q4 was 2.11%, with a year-on-year ratio of -7.54pp and a month on month ratio of -4.71pp. The profitability of 2021q4 has declined significantly, mainly due to: 1) weak terminal demand, blocked price increase, intensified double reduction policy and weak demand for cultural paper; 2) High energy costs; 3) The rise in sea freight has led to the rise in the price of waste raw materials in the United States of Laos base and weakened the cost advantage. As of February 2021, the industry has been near the breakeven line for about half a year, and the head paper enterprises have a strong willingness to raise prices. 2022m2-3 cultural paper price raising letters have been issued successively, and the implementation of cultural paper price increases after the Spring Festival is good; At the same time, small and medium-sized paper enterprises may partially withdraw, and the supply and demand pattern is expected to improve. We believe that the performance of 2021q4 has reached the bottom, and it is expected that the company's profitability will start to recover from 2022q1.
Event 2: signed a strategic cooperation framework agreement with Nanning municipal government and planned to acquire 100% equity of Liujing Quancheng held by Guangxi hongruitai paper.
Increase Guangxi's production capacity layout and make full use of Guangxi's resource endowment. The company and Nanning municipal government have agreed to invest in the construction of the forest pulp paper integration and supporting industrial park project with an annual output of 5.25 million tons. The project is planned to be located in Nanning Liujing Industrial Park, with a land area of about 3000 mu, a total investment of about 20 billion yuan and a total output value of about 30 billion yuan. Nanning, Guangxi has superior geographical location, good business environment, logistics and transportation advantages and forestry resources advantages. In addition, the company plans to acquire 100% equity of Liujing Quancheng held by Guangxi hongruitai Paper Co., Ltd. for 1.5 billion yuan, so as to enhance its local competitive advantage in Guangxi and ensure the smooth promotion of the project. In 2021, the company's Guangxi base phase I cultural paper, household paper and supporting chemical mechanical pulp have been put into operation. The implementation of this project will further enhance the scale advantage of Guangxi base, and is conducive to the overall and coordinated development of Guangxi Base in terms of product structure optimization, logistics system improvement and sales channel construction. The company's three bases in Shandong, Guangxi and Laos will further form synergy, improve the integrated layout of Forest Pulp and paper, and enhance the comprehensive competitiveness.
Profit forecast and investment rating: under the pressure of weak demand and energy cost, the performance of 2021q4 is under pressure, and it is expected to be gradually repaired later. According to the revised profit forecast in the 2021 performance express, the net profit attributable to the parent company in 20222023 is expected to be 3.29 billion yuan and 3.73 billion yuan respectively (the original forecast is 3.47 billion yuan and 3.98 billion yuan), corresponding to pe10x and 9x. The price increase of cultural paper has been successfully implemented. We judge that the profitability will be gradually repaired. The current valuation is at a low level and has a strong safety margin. We maintain the "buy" rating.
Risk warning: price fluctuation of raw materials; Impact of imported paper, price fluctuation of raw materials, postponement of production capacity, etc.
