\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 481 Shuangliang Eco-Energy Systems Co.Ltd(600481) )
Event: Shuangliang Eco-Energy Systems Co.Ltd(600481) issued the annual report for 2021.
The business sector blooms at multiple points, and the performance will double in 2021. According to the company’s annual report, in 2021, the company realized an operating revenue of 3.830 billion yuan (+ 85%), a net profit attributable to the parent company of 310 million yuan (+ 126%), and a net profit deducted from non attributable to the parent company of 238 million yuan (+ 136%). In terms of business segments, energy-saving and water-saving equipment achieved a total revenue of 2.558 billion yuan (+ 40%), including 1.194 billion yuan (+ 40%) for bromine cooler, 954 million yuan (+ 32%) for air cooler and 410 million yuan (+ 59%) for heat exchanger; In terms of photovoltaic sector, benefiting from the strong demand for downstream silicon material expansion, the company’s reduction furnace business achieved a revenue of 979 million yuan (+ 454%), and Shuangliang new energy equipment, the main subsidiary of reduction furnace business, achieved a net profit of 219 million yuan (17 million yuan in 2020), contributing to significant performance growth. The company’s new silicon wafer business was gradually put into operation at the end of 2021, realizing a revenue of 235 million yuan.
New business expansion brings short-term profit pressure, and scale expansion brings significant downward cost rate. In terms of gross profit margin, it was 27.84% (- 1.65 PCTs) in 2021. The silicon wafer business was put into operation at the end of the year, and the production capacity was in a climbing period, with a gross profit margin of – 12.05%, which brought a certain drag. It is expected that with the gradual release of production capacity and the full production capacity brought by the high downstream demand, the profit of silicon wafer business will be significantly improved, which will become an important profit support for the company in the future; The business income of reduction furnace increased significantly, and the gross profit margin also increased to 38.53%, driving the overall gross profit margin level of the company to remain stable. In terms of net interest rate, it was 8.88% (+ 2.33pcts) in 2021. After the increase of the main benefit scale, the sales expense rate (from 10.20% in 2020 to 6.22%) and the management expense rate (from 6.10% in 2020 to 4.60%) decreased significantly.
Full orders for silicon wafers are in hand, and accelerate the expansion of phase II 20GW monocrystalline silicon wafers. The construction of phase I 20GW silicon wafer project of the company is nearly completed, and has reached cooperation with Tongwei, aixu, Trina Solar, Atlas and other manufacturers. The total signed long single scale of silicon wafer / silicon rod has reached 63.686 billion yuan, and the orders on hand are full. The company will accelerate the investment and construction plan of phase II 20GW project. On March 7, the company announced the latest phase of the single crystal furnace procurement contract, and planned to purchase a total of 1.43 billion yuan of single crystal furnace equipment from Zhejiang Jingsheng Mechanical & Electrical Co.Ltd(300316) , CAIX. Since 2021, the total scale of the single crystal furnace procurement contract signed has reached 4.5 billion yuan, which can meet the demand of about 30GW of single crystal silicon capacity. At present, the company’s application for fixed increase has been reviewed and approved by the development and Examination Committee of the CSRC, After the raised funds are in place, it is expected to fully ensure the company’s demand for new capacity construction.
Silicon material entered a new round of production expansion wave, and the company’s reduction furnace orders continued to grow, promoting the release of performance. Recently, silicon material has ushered in a new round of large-scale production expansion. Daquan, Xinyi solar energy, Hoshine Silicon Industry Co.Ltd(603260) , Risen Energy Co.Ltd(300118) etc. have all arranged large-scale production expansion plans. Since the beginning of 2021, the company has signed a total of more than 3.5 billion yuan of reduction furnace equipment orders. The reduction furnace orders are expected to continue to be high and contribute significantly to the increase of performance.
Profit forecast: the company is expected to realize a net profit attributable to the parent company of 866, 1632 and 2.159 billion yuan from 2022 to 2024, corresponding to 22.8, 12.1 and 9.1 times of the valuation, and maintain the “overweight” rating.
Risk tip: the industry demand does not meet expectations and the company’s production capacity does not meet expectations.
