Harbin Jiuzhou Group Co.Ltd(300040) (300040)
The region's leading integrated renewable energy operator has increased the scale of new energy operation and arranged smart energy projects to promote rapid performance growth. Harbin Jiuzhou Group Co.Ltd(300040) was established in 1993 and has been transformed from intelligent electrical equipment supplier to renewable energy construction and operator since 2015. After years of efforts, the company has formed three business patterns: intelligent equipment manufacturing, renewable energy and comprehensive intelligent energy. In the first three quarters of 2021, the company achieved an operating revenue of 954 million yuan, a year-on-year increase of 15.36%; The net profit attributable to the parent company was 111 million yuan, a year-on-year increase of 97.18%; In 2021h1, the company has doubled its power generation capacity, power generation revenue and installed capacity. Renewable energy power generation has become the largest business of the company, and the transformation of the company has achieved initial results.
In the context of carbon neutrality, the demand for power grid investment continued to increase, and the business of intelligent electrical complete equipment grew steadily. China Southern Power Grid proposed to invest 670 billion yuan during the 14th Five Year Plan period, an increase of 51% over the actual investment in the 13th five year plan. The State Grid said that it plans to invest 350 billion US dollars in the upgrading of the power grid during the 14th Five Year Plan period. During the 14th Five Year Plan period, the demand for power equipment is expected to increase. The company has been deeply engaged in electrical complete sets of equipment for many years, and has become a provider of key complete sets of equipment and system solutions for intelligent distribution network. The performance of this sector is expected to maintain steady growth.
The scale of new energy operation has increased steadily. By 2021q3, all self-owned and indirectly held renewable energy power generation projects of the company have been connected to the grid, including 460.1mw of self-owned projects and 237.5mw of indirectly held projects. In Q4 of 2021, the new energy assets indirectly held through Jiaxing fund will be consolidated. In the future, relying on the location advantages of scenery resources and the cooperative relationship with SDIC, the competitiveness of the company's renewable energy power generation business is expected to be further improved, and the scale of grid connected new energy projects is expected to maintain a steady growth trend.
Comprehensive smart energy is the development direction, and the biomass cogeneration mode ensures the steady improvement of performance. By October 2021, the company has arranged biomass cogeneration projects with a scale of 650MW, including 160mw under construction. Biomass cogeneration project can effectively solve the problem of straw open-air incineration in the three eastern provinces, with strong support from the local government. The company promotes the construction and operation of biomass project through cooperation with Guodian investment group. On the one hand, it can realize EPC income through project construction, on the other hand, it can realize income and profit through power generation and heating after the project is put into operation, which can ensure the continuous improvement of the company's investment income.
The first coverage is rated as "overweight": it is expected that the net profit attributable to the parent company in 2021-23 will be 160 / 335 / 383 million yuan respectively, the corresponding EPS will be 0.27/0.57/0.65 yuan, and the current share price will be 36 / 17 / 15 times corresponding to PE in 21-23 years. With reference to the relative valuation and absolute valuation of comparable companies, Give the company a reasonable valuation level in 2022 (PE) 22 times, corresponding to the target price of RMB 12.55. Considering that the scale of the company's new energy operation power station will maintain a steady growth with the continuous implementation of fund consolidation and projects under construction, and the performance increment brought by the superposition of biomass energy projects to the company's construction and investment income, we are optimistic that the company's performance will maintain a high-speed growth trend in 21-23 years, covering for the first time "Overweight" rating.
Risk warning: the installed capacity of new energy is less than expected; Power grid investment is less than expected; Operation risk of biomass cogeneration project.
