Jiangsu Eastern Shenghong Co.Ltd(000301) (000301)
event
The company announced that the proposal of the company to purchase 100% equity of sierbang and raise supporting funds by issuing shares and paying cash was reviewed and unconditionally passed by the CSRC.
Smooth injection of high-quality assets and layout of upstream materials of new energy
The company plans to issue shares and pay cash to acquire 100% equity of sierbang, and the supporting financing will not exceed 4.09 billion yuan. The final price of sierbang is 14.36 billion yuan, of which the price for purchasing assets and issuing shares is 11.04 yuan / share, and the number of issued shares is 1.112 billion shares. The designed production capacity of MTO plant put into operation in Sri Lanka is about 2.4 million tons / year (in terms of methanol), the monomer scale ranks among the largest MTO units in the world. Photovoltaic grade EVA resin is the raw material for the packaging film of photovoltaic modules. Sri Lanka has a production capacity of 300000 tons of EVA resin, accounting for 67% of the sales of photovoltaic materials in the first half of 2021. Sri Lanka is currently the largest supplier of EVA photovoltaic materials in China. The production of photovoltaic grade EVA in China has been monopolized by foreign countries for a long time, and the price of EVA resin in 2021 The production of EVA photovoltaic materials needs a long process exploration period. With the release of photovoltaic demand, it is expected that EVA resin photovoltaic materials will continue to be in short supply.
Silbang focuses on the olefin deep processing industrial chain of high value-added products
Sri Lanka has formed a diversified product structure of coordinated development of basic petrochemical and fine chemicals, focusing on the olefin deep processing industrial chain. At present, the company has an acrylonitrile production capacity of 520000 tons, an acrylonitrile production capacity of 260000 tons has been completed, and the production capacity will reach 780000 tons after being put into operation. The existing MMA production capacity of 170000 tons and 85000 tons are under construction. It will be completed and put into operation in 2022, and the production capacity will reach 255000 tons at that time. The existing capacity of EO and its derivatives in Sri Lanka is 420000 tons, and the capacity will reach 520000 tons in 2022. The second phase propane industrial chain project in Sri Lanka is currently under construction, including 700000 T / a propane dehydrogenation unit, two 260000 T / a acrylonitrile units, two 90000 T / a MMA units and 210000 T / a SAR units.
Refining and chemical integration project will be put into operation soon, contributing to performance flexibility
In March and April 2019, the company acquired 100% equity of Shenghong refining chemical and Honggang petrochemical, and invested in the construction of Shenghong refining chemical integration project to form "crude oil refining PX"/
The new high-end textile industry chain structure of "ethylene glycol PTA polyester chemical fiber" has entered a new stage and pattern of coordinated development between oil refining and chemical fiber. Shenghong refining and chemical integration project under construction, with a design crude oil processing capacity of 16 million tons / year, The aromatics combined unit has a capacity of 2.8 million T / a (based on the output of p-xylene) and the ethylene cracking unit has a capacity of 1.1 million T / A. It is currently the largest atmospheric and vacuum distillation unit in China. It is planned to be put into operation at the end of 2021. After being put into operation, the refining and petrochemical integration project will form a synergistic effect with the company's existing business and Sri Lanka and contribute performance flexibility.
Profit forecast
Regardless of the impact of the acquisition of sierbang, it is predicted that the net profit of the company from 2021 to 2023 will be RMB 1.91/75.4/11.9 billion respectively, and the corresponding PE of the previous share price will be 56, 14 and 9 times respectively. It will be covered for the first time and given a "recommended" investment rating.
Risk statement
Risk of large fluctuations in oil prices; The commissioning progress of refining and chemical project is lower than expected; The production capacity launch progress of EVA resin industry is too fast; Photovoltaic demand is lower than expected; The progress of non-public offering is less than expected; Market systemic risk.
