Henan Hengxing Science & Technology Co.Ltd(002132) (002132)
Event: the silicone project with an annual output of 120000 tons has reached the trial production conditions. On December 30, the company announced that the trial production scheme of the holding subsidiary Inner Mongolia Xingxing Chemical Co., Ltd. "120000 T / a high-performance silicone polymer project" was reviewed and approved by the expert group. It has the conditions for commissioning and can officially enter the trial production stage.
The silicone project is located in a locked location, with wide demand, convenient transportation and low cost. In 2018, the company invested RMB 2.1 billion to build the "120000 tons / year high-performance silicone polymer project" in Inner Mongolia. The construction site of the project is located in Dalat Economic Development Zone, Dalat banner, city Inner Mongolia Eerduosi Resources Co.Ltd(600295) . The development zone is close to Baoshen railway, Baodong expressway, Baotou Airport and Erlianhot port. The transportation of raw materials and products is very convenient; The development zone is rich in methanol and hydrochloric acid raw materials, which can be obtained nearby for the project. The company's Silicone project has the advantages of low raw material cost and low transportation cost. It is expected to release 70% - 80% of the production capacity in 2022, which is expected to further improve the company's profitability.
The production capacity of diamond line business expanded rapidly to meet the new year of photovoltaic installation. The company's existing diamond line production capacity has reached 1 million kilometers per month. The "reconstruction and expansion project of ultra-fine diamond wire with an annual output of 10 million kilometers" is about to be completed, and the "ultra-fine diamond wire project with an annual output of 30 million kilometers" is advancing in an orderly manner. After the completion of the above projects, the company will realize the annual production capacity of 46 million km diamond line, which is at the leading level in the industry. After November 2021, the high price of photovoltaic industry chain will drop, and the downstream installed demand is expected to be further released in 2022. As one of the leading enterprises of diamond line, the company is expected to fully benefit.
Investment suggestion: the operation of the company's steel strand and steel cord business is stable, the photovoltaic diamond line business expands rapidly with the downstream installation demand, and the expanded capacity is gradually put into operation; The release of production capacity of silicone project will help the company achieve the second growth curve. We expect the company to achieve revenue of RMB 3.01/75.2/9.13 billion and net profit attributable to the parent company of RMB 162/759/1.03 billion from 2021 to 2023, corresponding to pe45.5 billion 9 / 9.81/7.27x. Maintain the "overweight" rating.
Risk tip: the PV installation demand is less than expected; The downstream demand of silicone is lower than expected; Cycle fluctuation risk of chemical industry.
