\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Events
On February 25, the company released the performance express. In 2021, the company achieved a revenue of 31.87 billion yuan, a year-on-year increase of + 47.6%, and a net profit attributable to the parent company of 2.94 billion yuan, a year-on-year increase of + 50.6%; Among them, 4q achieved a revenue of 8.16 billion yuan, a year-on-year increase of + 37.1%, and a net profit attributable to the parent company of 170 million yuan, a year-on-year increase of - 69.8%. 4q's performance was lower than the median value of the previous performance forecast.
Business analysis
Under the cost pressure brought by high energy & high price slurry, 4q's performance is under pressure. 1) Cultural paper: from 3q21, the demand boom was low, the cost transmission was not smooth due to the suppression of imported paper, and the impact of high-cost inventory of energy and power coal (the average price of Qinhuangdao Power Coal Market 3Q / 4q increased 31% / 18% month on month respectively), and the profit of 4q tons was suppressed; In addition, with the production capacity launch in Guangxi, the depreciation and investment in new market development brought by the production capacity climbing have increased, which has a short-term drag on profits. 2) Carton board paper: the profit of Chinese tons is expected to be high before and low after. After December, the paper price has dropped due to the weakening demand; At the initial stage of 4q of overseas Laos carton paper production capacity, affected by the high sea freight, the cost of foreign waste is high, and the profit per ton of carton paper is expected to be 50 ~ 100 yuan / ton.
Cost support: supply and demand have warmed up, the first round of price increase of cultural paper has been smooth, and it is optimistic that the profit of 22 years will be repaired quarterly. Since September to October of the 21st year, the profit of the whole industry has entered the historical bottom. The current operating rate has dropped to 63%, and the inventory has dropped to a historically low level. The first round of price increase letters of 200 yuan / ton issued by paper enterprises has been successfully implemented. The proportion of self supplied pulp of the company is high, and the profitability is weakened compared with the cost elasticity. It is optimistic that the profit per ton has hit the bottom and warmed up quarter by quarter.
It plans to acquire Guangxi Liujing Chengquan to improve the position of pulp and paper in the southern market. The production capacity of phase III packaging paper is expected to be put into operation by the end of the year. According to the company's announcement, it plans to acquire 100% equity of Liujing Chengquan, a subsidiary of Guangxi hongtairui paper industry, at a price of 1.5 billion yuan, which will be paid in three phases. We expect that this move will further accelerate the company's layout in the southern market and is also expected to form synergy with the supporting production infrastructure of Guangxi phase III project. At present, phase I and phase II projects in Guangxi have been successfully put into operation, 800000 tons of chemical pulp and 200000 tons of chemical mechanical pulp have been successfully put into operation in December, and the self supply proportion of wood pulp has reached 55%. Guangxi's phase III pulp and paper production capacity of 1.76 million tons is expected to be put into operation at the end of 22. The new production capacity will be released & the industrial chain will be improved, and the medium and long-term growth can be expected.
Profit forecast and investment suggestions
Considering the subsequent comprehensive judgment on raw material cost and paper price, we lowered the EPS forecast from 2022 to 2023 to 1.13/1.19 yuan, with a reduction range of 12.4% / 29.9%. The current stock price corresponds to 10.7x/10.2x PE from 2022 to 2023, maintaining the "buy" rating.
Risk tips
The risk of lower than expected price rise of paper products due to lower than expected downstream demand; The risk that the schedule of new production capacity is not up to expectations; The risk of ineffective cost rate control of the company; Risk of sharp fluctuations in raw material prices.
