\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 117 China National Chemical Engineering Co.Ltd(601117) )
Event overview
On March 9, 2022, the company issued a business briefing. From January to February, 2022, the cumulative newly signed contract amount was 76.742 billion yuan, a year-on-year increase of 87.53%, of which the contract amount outside China was 67.15 billion yuan and 9.592 billion yuan respectively, a year-on-year increase of 83.83% and 118.3%. On March 9, 2002, the company announced that it had made important progress in key industrial and new material projects invested and constructed.
Analysis and judgment:
In the first two months, revenue and orders continued to increase, and the company’s engineering business has great prospects under the dual carbon economy.
From January to February, the company signed 76.742 billion yuan of new orders, an increase of 87.53% year-on-year, 5pct higher than that in January, showing a sustained and rapid growth trend. The amount of engineering contract orders is 73.401 billion yuan, including 52.944 billion yuan for chemical engineering, 18.196 billion yuan for infrastructure and 2.261 billion yuan for environmental treatment, accounting for 72% / 25% / 3% respectively. The performance of major contracts is remarkable, including three-dimensional 300000 tons of BDO, degradable new materials, Tongbang 200000 tons of PLA and other degradable projects, which shows that in addition to consolidating the dominant position of the traditional market, Through R & D innovation and technology transformation, we have fully benefited from the rapid growth of investment in emerging markets such as new materials. We are optimistic about the future development of the company’s main engineering industry. On the one hand, the state has set a steady growth rate for the economy, and the GDP growth rate is expected to be 5.5% in 2022. The report of the two sessions reiterated that the new renewable energy and raw material energy will not be included in the total energy consumption control, and the energy intensity target will be comprehensively assessed during the 14th Five Year Plan period, which will benefit coal chemical industry, new materials The new investment and technological transformation investment in new energy and other fields have increased steadily. On the other hand, under the background of the double carbon policy, the coupling development of multiple industries is an inevitable trend in the future. As a national engineering team with multiple design institutes with comprehensive grade a qualification, the company is positioned as a service provider of comprehensive solutions in the field of industrial engineering in the future, Wuhuan company, one of its subsidiaries, won the bid for the preparation project of carbon peak and carbon neutralization action plan in Hubei petrochemical and chemical industry in October 2021; The company participates in the double carbon policy from top to bottom, which is conducive to the order growth and valuation improvement of the main engineering industry.
With regard to the impact of the Russian Ukrainian conflict on the company’s overseas projects recently concerned by the market, the company mentioned in the recent SSE E interaction that in the orderly development of international business, the progress of the Russian Baltic project is in line with expectations, and the contract payment received is in line with the progress. Before the implementation of the project, the company carried out risk prevention and control through a series of measures such as contract agreement, settlement currency and progress payment. The recent sharp rise in oil prices is bad for petrochemical in the short term. In 2021, H1 petrochemical and coal chemical orders accounted for 10.58% and 11.64% respectively. If the oil price continues to rise, the proportion of coal chemical orders will increase accordingly, which has little impact on the company’s overall orders and revenue.
Adiponectin, aerogels and PBAT have made significant progress and the key year for new material business to take off.
The Tianchen Qixiang adiponitrile project of the company, as the first set of neck technology to break through the butadiene process to produce adiponitrile in China, is now about to be put into operation. It is expected that acrylonitrile will be produced in mid March, hexanediamine will produce qualified products by the end of March, and adiponitrile will produce qualified products in early April; The production capacity of phase I is 200000 tons, and the maximum production capacity can be increased to 300000 tons per year after process optimization. In terms of sales, the company focuses on integrating the downstream customer resources of hexanediamine, has carried out strategic cooperation with more than 10 customers, and cultivated the downstream potential market and customers of nylon 66. Hua Lu new material aerogel project was successfully launched in February 27, 2022. The first phase has 50 thousand capacity. At present, it has signed a cooperation agreement with more than thirty enterprises, which has already sold about 15 thousand and 500 parties in advance. The pilot production of 100000 tons of degradable plastic materials has been successfully completed and the first phase of chemical mechanical production has entered the first phase.
2022 is a key year for the company to develop its strategy of building a supplier of high-end chemicals and advanced materials. The above three new material industrial projects have been successfully completed or put into operation, which eliminates the market’s doubts about the project’s production time and will greatly increase the company’s profits. Taking adiponitrile project as an example, according to the current butadiene price of Zhuo Chuang, the theoretical full cost of hexanediamine is 15000 yuan / ton, In 2021, the average market price of hexanediamine is 53000 yuan / ton. After the first phase of the company is 300000 tons and the next two phases are 500000 tons, it is conservatively predicted that it will contribute at least billions of profits. Over the past three years, the company has invested nearly 10 billion yuan in research and development. Adiponectin and aerogels are all Necking Technology. This breakthrough has made a great leap forward in the production process. It shows that the company’s R & D capability has begun to fall rapidly. It is expected that the company will continue to strive to build a leading professional in the field of new materials and new energy in the future. A world-class engineering company with strong core competitiveness.
Investment advice
Maintaining the previous profit forecast, it is estimated that the operating revenue of the company from 2021 to 2023 will be 131.8/157178.6 billion yuan respectively, the net profit attributable to the parent company will be 44.2/74.5/9.72 billion yuan respectively, and the EPS will be 0.72/1.22/1.59 yuan respectively, corresponding to the closing price of 8.60 yuan on March 9, 2022 and the PE will be 12 / 7 / 5 times. Maintain the “buy” rating.
Risk tips
Risk that the production schedule of adiponitrile project is lower than expected.
