\u3000\u3 Guocheng Mining Co.Ltd(000688) 357 Luoyang Jalon Micro-Nano New Materials Co.Ltd(688357) )
Event: the company released its annual report for 2021. In 2021, the company achieved an operating revenue of 878 million yuan, a year-on-year increase of 94.36%, and a net profit attributable to the parent company of 275 million yuan, a year-on-year increase of 116.22%. The company’s performance met expectations.
Performance growth driven by new production capacity: 1) performance growth driven by new production capacity release: in the first half of 2021, the company put into operation 1000 tons of special molecular sieve production line for carbon monoxide separation and purification and 9000 tons of molecular sieve for oxygen and hydrogen production. The 12000 tons of raw powder production capacity of the Thai subsidiary was completed in the fourth quarter of 2021, At the same time, the third phase of the company’s fund-raising project adsorption material industrial park has also been completed. The release of production capacity is the main reason for the sharp increase in the company’s performance in 2021. In terms of sales volume, the company achieved 13200 tons, 24800 tons, 2459 tons and 2908 tons of molecular raw powder, molecular sieve molding powder, molecular sieve activation powder and activated alumina respectively in 2021, an increase of 49.24%, 46.69% and 54.68% and 68.46%.
2) in 2021, the gross profit margin and net profit margin of the company were 46.54% and 31.38%, with a year-on-year increase of 2.15 and 3.17 percentage points respectively.
3) in 2021, the company realized a net cash flow of 388 million yuan from operating activities, with a year-on-year increase of 204.52%.
4) in the construction of the reconstruction and expansion project of Luoyang Jalon Micro-Nano New Materials Co.Ltd(688357) adsorbent Industrial Park of the company, the products include molecular sieve adsorbents and catalysts used in the fields of environmental protection and energy and chemical industry. The total capacity of phase III includes 10100 tons of molecular sieve raw powder and 14100 tons of molding powder. The phase I project is under construction. After the project is completed, 2100 tons of raw powder capacity of the company will be added, The capacity of formed molecular sieve is 8100 tons.
Optimistic about the company’s import substitution of molecular sieves in many fields: industrial gas is an important part of the national economy, and there is still a large space for import substitution of molecular sieves as consumables. While consolidating the advantages of traditional fields, the company plans to extend from adsorption molecular sieves to catalytic molecular sieves, which is expected to benefit from the new market brought by the implementation of national six standards, Open space for medium and long-term growth.
Profit forecast and investment suggestions: we expect the net profit attributable to the parent company from 2022 to 2024 to be 403, 522 and 652 million yuan respectively, corresponding to 21, 16 and 13 times PE respectively, maintaining the “buy” rating.
Risk tip: the risk of product price decline caused by intensified market competition, the risk of product upgrading, sharp fluctuations in raw material prices, and the release progress of new capacity is less than expected
