\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 100 Jiangsu Hengli Hydraulic Co.Ltd(601100) )
Event: on March 7, 2022, the company disclosed the 2021 annual performance express, which realized a revenue of 9.309 billion yuan (year-on-year + 18.51%) and a net profit attributable to the parent company of 2.694 billion yuan (year-on-year + 19.52%); It is calculated that the revenue of 2021q4 is 2.227 billion yuan (year-on-year – 16.00%), and the net profit attributable to the parent company is 708 million yuan (year-on-year – 9.44%).
The share of excavators and non excavators continued to increase. Affected by the continuous growth of China’s Excavator Industry and the continuous improvement of the competitiveness of the company’s products, the company’s product sales increased during the reporting period, in which the revenue of excavator cylinder products increased by 12% year-on-year (the calculated revenue in 2021 was 3.76 billion yuan), and the revenue of non-standard cylinder products increased by 24% year-on-year (the calculated revenue in 2021 was 1.699 billion yuan), The revenue of hydraulic pump and valve products increased by 38% year-on-year (it is calculated that the revenue in 2021 is 3.227 billion yuan). In 2021, the sales volume of excavator in China was 342800 units, with a year-on-year increase of only 4.63%. The sales revenue of excavator cylinder products of the company increased by 12% year-on-year, reflecting the continuous improvement trend of the company’s market share in the field of excavator; In addition, the company’s non-standard oil cylinder revenue increased by 24% year-on-year, far exceeding the growth rate of excavator oil cylinder, which reflects that the downstream expansion trend of the company’s products is still continuing; The revenue of the company’s hydraulic pump and valve products increased by 38% year-on-year, reflecting the trend of the company’s continuous increase in the market share of excavators and non excavators.
Although the revenue of 2021q4 fell year-on-year, it was not easy, and the net profit attributable to the parent company performed well: 1) the sales volume of excavators in 2021q4 was – 30.35% year-on-year, of which the year-on-year growth rates of 21m10 ~ 21m12 were – 30.5%, – 36.6% (the worst month of year-on-year growth in the whole year of 21) and – 23.8% respectively. It was not easy for the company’s revenue to fall by 16% year-on-year; 2) 2021q4 company realized a net profit attributable to its parent company of 708 million yuan, a year-on-year decrease of 9.44%, which is lower than the revenue. It is expected that it may be mainly related to the reduction of R & D expense rate. In order to improve the added value of products, the company increased R & D investment in 2021. The R & D expense rates from 2020q4 to 2021q3 are 5.4%, 4.0%, 5.4% and 12.3% respectively. The R & D expense rate of 2021q4 is relatively high, It is estimated that the year-on-year increase of 2021q4 R & D expense rate may be narrowed.
Prediction for 2022: the growth rate is low first and then high, and the year-on-year growth rate in Q2 may improve. The proportion of non-standard oil cylinder (i.e. non excavator oil cylinder) in the company’s revenue in 2021 was only 18.25%, and most businesses were still affected by the boom of the excavator industry. The national excavator sales volume in 2022m1 was 15600, down 20.4% year-on-year, which has been narrowed compared with 2021m12. However, considering the very high growth rate of sales volume from 2021m1 to 2021m3, 2022q1 is still a time period with high pressure on year-on-year growth, However, the year-on-year growth rate may improve from Q2.
Investment suggestion: it is estimated that the net profit of the company from 2021 to 2023 will be 2.69 billion yuan (disclosed), 2.78 billion yuan and 3.32 billion yuan, with corresponding EPS of 2.06 yuan, 2.13 yuan and 2.54 yuan respectively, and corresponding valuations of 27x, 26x and 22x respectively, maintaining the “recommended” rating.
Risk tips: 1. The demand of excavator is lower than the expected risk; 2. The global economic recovery is affected by the epidemic and the slowdown affects the risk of overseas demand.
