\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 79 Huali Industrial Group Company Limited(300979) )
Key investment points:
Event: the company released the annual performance express of 2021. It is estimated that the operating revenue will reach 17.47 billion yuan in 2021, with a year-on-year increase of 25.40%, and the net profit attributable to the parent company will reach 2.768 billion yuan, with a year-on-year increase of 47.34%. After excluding the impact of exchange rate changes, the operating revenue and net profit attributable to the parent company are expected to increase by 34.09% and 57.55% year-on-year in 2021, which is in line with the expectation.
The high growth trend of the whole year continued. The overall growth of the company in 2021 was significant, of which the growth rate of net profit was higher than that of operating revenue, mainly because the company continued to implement the business strategy of high-quality key customers, optimize the customer and product structure, actively promote automation and lean production, improve production efficiency, and the gross profit margin increased compared with last year. In a single quarter, the company's Q4 is expected to achieve an operating revenue of 4.834 billion yuan, a year-on-year increase of 33.48%, and the revenue in US dollars is expected to increase by about 35% year-on-year; The net profit attributable to the parent company was 771 million yuan, a year-on-year increase of 37.43%, continuing the high growth trend in the first three quarters.
The improvement of operation efficiency drives the continuous enhancement of profitability. The gross profit margin / net profit margin of the company in the first three quarters were 27.87% / 15.81% respectively, with a year-on-year increase of 3.90/3.03pct respectively. The company increased its epidemic prevention expenditure in 2021, but thanks to the company's strengthened management, improved automation level, optimized customer structure, enhanced scale effect and improved operating efficiency, it is expected that the annual gross profit margin and net profit margin will increase by 3-4pct year-on-year in 2021, and the profitability will continue to increase.
The revenue of the top five customers increased significantly. The company implemented the strategy of high-quality key customers. In the first three quarters of 2021, the revenue of the top five customers was 11.752 billion yuan, a year-on-year increase of 27.81%, excluding the impact of exchange rate changes, a year-on-year increase of 38.08%, accounting for 93.01%. Specifically, Nike is still the company's largest customer, contributing an operating revenue of 4.422 billion yuan in the first three quarters, a year-on-year increase of 38.07% (excluding the impact of exchange rate changes, a year-on-year increase of 49.17%), accounting for 35.00% of revenue; Deckers, VF, Pu Ma and under armour contributed RMB 2746 million, 2453 million, 1402 million and 729 million respectively, with year-on-year growth of 45.94%, 1.30%, 14.50% and 56.84% respectively. Excluding the impact of exchange rate changes, Deckers, VF, Pu Ma and under armour increased by 57.67%, 9.44%, 23.71% and 69.45% respectively, accounting for 21.73%, 19.41%, 11.10% and 5.77% respectively. The revenue contribution of the company's top five customers increased steadily, and the customer structure and product structure continued to be optimized. The revenue from major customers increased significantly in 2021. At the same time, the company's orders from new customers ASICs, on and new balance have been mass produced and shipped. It is expected that the top five customers in 2021 will be consistent with the third quarterly report, and Nike, ugg and other brands will maintain rapid growth.
Capacity continues to expand, with North Vietnam and Indonesia as the main regions. The unit price of the company's products has changed slightly over the years. Referring to the unit price level of the company from 2019 to 2021q3 (81-85 yuan), it is estimated that the total shipment volume in 2021 will be 210 million pairs, an increase of more than 40 million pairs compared with 2020. At present, the main areas of the company's capacity expansion are North Vietnam and Indonesia. In 2022, it is expected that the capacity climbing cycle of the three factories in Vietnam Weilin, Vietnam Yongshan and Vietnam Hongxin (put into operation in the first half of 2021) will end, and the factory will reach full production. At the same time, the first phase of the Indonesian factory will also be put into operation at the end of the year, and it is expected to contribute capacity at the beginning of 2023.
Investment suggestion: the company has full orders and has established long-term and stable cooperative relations with major customers. Considering that there are many new shipments in 2021 and the low base in 2020, the new shipments in 2022 are expected to be slightly lower than or equal to the increment in 21 years, and the company's profit forecast is adjusted slightly accordingly, It is estimated that the operating revenue of the company from 2021 to 2023 will be RMB 17.470/20.891/24.710 billion respectively, and the net profit attributable to the parent company will be 27.68/34.30/40 million respectively RMB 0.9 billion, EPS is 2.37/2.94/3.94 respectively 61 yuan / share. As a leader in the manufacture of sports shoes, the company adhered to strict epidemic prevention and control measures and effectively guaranteed the production capacity. At the same time, the company continued to promote automation and lean production, improve production efficiency and optimistic about the company's long-term profitability. The company was given a PE valuation of 35-38 times in 2022, with a reasonable price range of 102.90-111.72 yuan, maintaining the "recommended" rating.
Risk tip: the capacity expansion is less than expected, and the epidemic repeatedly affects the operating rate.
