\u3000\u30 Fawer Automotive Parts Limited Company(000030) 38 Anhui Xinbo Aluminum Co.Ltd(003038) )
Performance summary: the company achieved an operating revenue of 2.597 billion yuan in 2021, a year-on-year increase of 101.72%; The net profit attributable to the parent company was 121 million yuan, a year-on-year increase of 33.01%; Net profit deducted from non parent company was 109 million yuan, with a year-on-year increase of 29.60%.
Under the cost plus pricing mode, the gross profit per ton remains stable. Affected by the rise in the price of raw material aluminum ingots, the gross profit margin of the company’s main business in 2021 was 13.04%, a year-on-year decrease of 2.05pp; The sales volume of aluminum products was 112700 tons, with a year-on-year increase of 62.86%. The gross profit per ton of aluminum products was 2992 yuan, a slight increase of 33 yuan year-on-year. Under the cost plus pricing mode, the company’s gross profit per ton remained stable and even increased slightly. The net profit per ton was 1074 yuan, a year-on-year decrease of 240 yuan, mainly due to: 1) the R & D expenses increased by 144% year-on-year; 2) The asset impairment loss of 23.75 million yuan was withdrawn.
The product structure was improved and the proportion of key customers increased. From the perspective of income structure, the income of industrial aluminum parts accounted for 32.61%, an increase of 8.39pp compared with 2020. This reflects the increase in the proportion of shipments of the company’s frame parts and the improvement of the product structure. The proportion of the company’s top five customers’ revenue increased to 60.11%, and the sales revenue of head customers increased rapidly. The revenue of the top three customers accounted for 21.53%, 18.53% and 13.93% respectively. The revenue structure is more healthy and reasonable.
The price of aluminum ingots is high, the pressure of cash flow is prominent, and the financing ability of listed companies has obvious advantages. Affected by the rapid growth of shipments, the high price of raw materials and the funds occupied by downstream customers, the company’s net operating cash flow outflow was 385 million. By the end of 2021, the company’s short-term loan was 832 million yuan, an increase of 341.75% compared with the same period in 2020 (before listing), reflecting the advantages of the company in financing ability after listing, cooperating with the rapid expansion of production capacity and significantly seizing market share.
R & D investment increased rapidly and new categories continued to expand. In 2021, the company’s R & D expenditure was 113 million, with a year-on-year increase of 144.11%. The company has 252 R & D personnel, with a year-on-year increase of 77.46%. R & D investment is mainly used to improve the performance and quality of existing products and increase product categories in medical equipment, automobile, power supply equipment and other fields.
Profit forecast and investment suggestions. The company’s Q4 performance hit a record high, the proportion of industrial aluminum parts with stronger profitability increased, and the customer structure was more reasonable. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 269 million yuan, 415 million yuan and 557 million yuan respectively, corresponding to 28, 18 and 14 times of PE respectively, with a compound growth rate of 66.38%. Give a 35 times valuation in 2022, raise the target price to 88.58 yuan and maintain the “buy” rating.
Risk tip: the price of aluminum ingot rises rapidly, the aluminum frame is replaced by other products, and the construction and production progress of new production capacity is less than expected.
