\u3000\u3 China Vanke Co.Ltd(000002) 258 Lier Chemical Co.Ltd(002258) )
Lier Chemical Co.Ltd(002258) released the annual report of 2021: the annual operating revenue was 6.494 billion yuan, yoy + 30.70%, the net profit attributable to the parent company was 1.072 billion yuan, yoy + 75.17%, and the corresponding EPS was 2.04 yuan.
Affected by the price rise of the main product glyphosate, the profitability of the company has increased significantly. In 2021, the average market price of glyphosate rose sharply by 75% to 243000 yuan / ton, especially in the fourth quarter to 370000 yuan / ton, which led to a significant increase in the company's revenue and gross profit level of glyphosate products. From the revenue side, the company's main pesticide product business has achieved stable growth. In 2021, the revenue of the company's original pesticide business increased by 26.91% year-on-year to RMB 4.331 billion, and the revenue of pesticide preparation business increased by 26.57% year-on-year to RMB 1.363 billion. In terms of gross profit margin, the company's comprehensive gross profit margin increased by 3 percentage points to 32%, of which the gross profit margin of the company's pesticide original drug business increased by 3.86 percentage points to 34.74%, and the gross profit margin of pesticide preparation business increased by 4.35 percentage points to 31.18%. In terms of period expenses, operating expenses decreased by 36% and financial expenses decreased by 24%, driving the company's operating profit to increase by 77%, resulting in a significant increase in the company's net profit.
The company is a leading enterprise of glyphosate in China, and the gradual introduction of new production capacity is expected to further consolidate the company's leading position in the industry. Glufosinate has great market potential. Glufosinate has become the second largest herbicide for genetically modified crops in the world. According to the prediction of Zhongnong Zongheng, the global glufosinate market sales will be US $1.05 billion in 2020. With the promotion, application and listing of new glyphosate resistant gene products developed by multinational companies, especially China is orderly promoting the industrialization of genetically modified crops from the policy level, we expect the demand for glyphosate to further increase. According to the company's annual report, in 2021, the market share of the company's glufosinate technical drug in the Chinese market was as high as 50 ~ 60%. The company has mature technology, stable supply chain and large-scale production, and the manufacturing cost of products has advantages. The company has a total production capacity of 18400 tons of glyphosate, of which 10000 tons of production capacity of Guang'an base of the company has reached the production capacity, and the supporting methyl phosphorus dichloride intermediate project is expected to be put into operation within the year. We expect that after the completion of the merger, the production cost of glyphosate will further reduce, which will help to further consolidate the leading position of the company in the industry.
New products and projects ensure long-term growth. The company plans 3000 tons and 20000 tons of l-glufosinate projects in Guang'an base and Mianyang base (compared with ordinary glufosinate products, l-glufosinate only contains optical isomers in L-configuration, and theoretically the use of glufosinate per mu can be reduced by 50%), and reserves new varieties such as oxazolin oxalate, chlorfenoxamide and flame retardant. According to the company's annual report, the company's new product l-glufosinate has entered the trial production stage, oxazolidinyl ester has entered the pilot test stage, and chlorfenoxamide has entered the pilot test stage. We believe that with the gradual commercial production of these new products and projects, the company is expected to increase new profit growth points in the future.
Profit forecast and investment rating of the company: we are optimistic that the company, as a leading enterprise of glyphosate in China, will continue to expand its product scale and further reduce its cost, which is expected to fully benefit from the further growth of the demand of the agrochemical industry. Based on the company's 2021 annual report, we adjusted the company's profit forecast from 2022 to 2024 accordingly. We predict that the net profit of the company from 2022 to 2024 will be 1.198 billion yuan, 1.349 billion yuan and 1.539 billion yuan respectively, and the corresponding EPS will be 2.27, 2.56 and 2.92 yuan respectively. The corresponding P / E value of the current stock price will be 16, 14 and 12 times respectively. Maintain a "strongly recommended" rating.
Risk warning: the release of downstream demand is less than expected; Falling product prices; The project construction was not as expected.
