\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 989 Ningxia Baofeng Energy Group Co.Ltd(600989) )
Events
2021 annual report: the revenue reached 23.3 billion yuan, a year-on-year increase of 46.29%; The net profit attributable to the parent company was 7.07 billion yuan, a year-on-year increase of 52.95%; The net profit deducted from non-profit was 7.336 billion yuan, a year-on-year increase of 51.33%.
Corresponding to Q4, the net profit attributable to the parent company in a single quarter is 1.752 billion yuan, and the non net profit deducted is 1.808 billion yuan; Net profit deducted from non profits increased by 18.41% year-on-year in 20q4 and 9.08% month on month in 21q3.
Brief comment
In the past 21 years, the boom has rebounded significantly and the performance has returned to a reasonable central level
For the whole year of 21 years, the company's revenue and net profit increased significantly year-on-year. Except that Hongsi coal mine (about 2.4 million tons of raw coal capacity) was gradually put into operation, the main change came from the improvement of single ton profit of products. In 2020, due to the covid-19 epidemic, the oil distribution futures was once as low as negative, and the prices of olefins, coke and other chemicals were also relatively low. In 2021, the oil price and coal price rose sharply as a whole, and the prices of the company's products increased significantly, such as the average price of polyethylene in 2021 was 8386 yuan / ton (year-on-year + 20%), the average price of polypropylene was 8623 yuan / ton (+ 13%), and the average price of coke was 3050 yuan / ton (+ 46%). Although the coal price has also increased significantly and the profit margin has not improved significantly, the profit of single ton products has expanded significantly, which has significantly improved the overall profit of the company.
In the single quarter of 21q4, the performance of Q4 was deducted from RMB 1.81 billion, with a month on month increase of + 9% under the historical high coal price, which was consistent with the disclosure of express and very stable. The robustness is mainly due to the relatively strong control of coal procurement cost of the company. We estimate that the average price of 21q4 6 Hitevision Co.Ltd(002955) 500k pit mouth is about 1110 yuan / ton (calculated according to the closing price). According to the operation data, the purchase price of Q4 gasification coal is about 936 yuan / ton, saving nearly 200 yuan / ton. This enables the company to maintain the profitability of coal to olefins under the historical coal price of 21q4.
In terms of expense rate, the company's 21-year sales, management, finance and R & D expense rates were 0.26%, 3.13%, 1.11% and 0.57% respectively, with a year-on-year increase of -2.12, -0.35, -0.15 and -0.25pct respectively. In addition to the sales expense rate, there is a downward trend with the rise of product price; The change of sales expense rate is mainly due to the change of accounting policies related to transportation expenses, which has no impact on the net interest rate.
Coal to olefin is the leader in the benefits. At present, it still has full cost competitiveness under the high coal price. At the same time, it may continue to benefit from the supplementary rise of olefins
Ningxia Baofeng Energy Group Co.Ltd(600989) is located in Ningdong base, one of the four major modern coal chemical industry demonstration bases in China. It is adjacent to high-quality and low-cost coal resources and has obvious location advantages. At present, there is a coal → methanol → polyolefin whole industry chain with the capacity of about 7.5 million tons of coal mine (included in Hongsi coal mine), 3.6 million tons of methanol and 1.2 million tons of polyolefin. At the same time, the by-products C4 and C5 are further processed into fine chemical products, and the coal chemical industry chain is highly integrated. Coupled with the efficient management of the company, the company has a significant cost competitive advantage. The gross profit margin and roe level of products rank first in the industry in recent years, and the overall profitability of coal to olefin projects ranks first in the industry.
Since the second half of the year, coal shortage has become a hot topic. However, even if the coal price level is high, the company is expected to maintain a fairly stable profit through stable coal procurement cooperation and efficient cost control of production process, and obtain sufficient cash flow to support future capital expenditure plans. On the other hand, the oil price has risen sharply in recent months. At present, the oil distribution futures are about 120 US dollars / barrel, and the increase of polyolefins is relatively backward. However, from the historical experience and the load reduction of oil head enterprises, there may still be a large room for the price of olefins to make up for the rise in the short term and thicken the profits of the company.
Since 22 years, the production capacity has been continuously put into operation, with the ultimate cost advantage + efficient capital expenditure, and the logic of long-term growth is smooth
At present, the company is in the period of rapid expansion of business volume. In 2022 and later years, with regard to the projects announced by the company, the company expects the new revenue and profit increment to come from: ① the 3 million T / a coal coking polygeneration project, the construction of 3 million T / a coking, 100000 t / a needle coke and other production capacity, which is expected to gradually climb within the year; ② Ningxia phase III 1 million T / a olefin project has a planned production capacity of 500000 tons of PP + 250000 tons of PE + 250000 tons of EVA. While further expanding the production capacity, promote the high-end products, of which 500000 tons are recycled, which may further reduce the unit cost of coal to olefin of the company; ③ Ningxia phase IV project is planned to be 500000 T / a olefins, which has been publicized before being submitted for approval in June 2021; ④ The EIA of the 4 million ton coal to olefin project in Inner Mongolia has not been passed, but we think there is no need to be pessimistic under the background of policy correction and marginal relaxation of capacity approval in high energy consuming industries. After the project is put into operation, it is expected to greatly increase the company's revenue and net profit, further reduce the cost of coal to olefins and further enhance the company's competitiveness.
The layout of green hydrogen is accelerated, and the carbon reduction strategy is far-reaching, leading the low-carbon transformation of the industry
In 2019, the company launched the demonstration projects of 200MW photovoltaic power generation and 20000 standard m3 / h electrolytic water hydrogen production, energy storage and comprehensive application, which have been partially completed and put into production. The project adopts the new mode of "new energy power generation + electrolytic water to produce green hydrogen and green oxygen directly for coal chemical industry", which directly sends the produced hydrogen and oxygen to the chemical plant, realizes the substitution of new energy for fossil energy, and opens up an economically feasible scientific path to realize carbon emission reduction. Next, Ningxia Baofeng Energy Group Co.Ltd(600989) will take out depreciation funds and some profit funds to improve the conversion rate and reduce the production cost through scientific and technological innovation. In the long term, it is expected to realize the cost matching between green hydrogen and hydrogen production from fossil energy, and truly realize the scientific path of "carbon neutralization" with advanced technology and economic feasibility. The "conversion" link in the coal to olefin process will emit a large amount of carbon dioxide. If the conversion of green hydrogen instead of syngas can be realized, the carbon emission of the company's production of single ton polyolefin is expected to be reduced by about 2 / 3, so that "carbon neutralization" and "carbon peak" will not become an obstacle to the further development of the company in the long run.
Looking at the first tier coal chemical enterprises in the industry, the strategic determination and geographical endowment (sunshine conditions and land area) of the company in the layout of photovoltaic power generation and electrolytic hydrogen production are significantly ahead, which is expected to continue to lead the low-carbon transformation of the industry. In the annual report, the company first mentioned that "since 2022, it is planned to increase the green hydrogen production capacity by 300 million standard cubic meters per year, increase and reduce the total carbon emission of chemical plants by 5%, strive to complete the enterprise's carbon emission reduction by 50% in 10 years and take the lead in realizing the enterprise's carbon neutralization in 20 years." It shows the firm layout of the company in the field of green hydrogen and carbon reduction.
Investment advice
We predict that the net profit attributable to the parent company in 2022, 2023 and 2024 will be 8.302 billion yuan, 10.522 billion yuan and 13.112 billion yuan, corresponding to eps1.2 billion yuan 13. 1.43 and 1.78 yuan, corresponding to pe14.00 yuan 5. 11.4 and 9.2 times, continuously recommend and maintain the "buy" rating.
Risk tips
Large fluctuations in global crude oil or Chinese coal prices; Changes in industrial policy
