Zhejiang Hangke Technology Incorporated Company(688006) (688006)
Key investment points
event:
The company plans to issue shares to specific objects, and the total amount of funds raised shall not exceed 2.312 billion yuan. After deducting the issuance expenses, it will be used for projects such as intelligent manufacturing and construction of lithium battery charging and discharging equipment.
The expansion of overseas lithium battery production is expected to accelerate. Funds raised for production expansion and other projects are expected to fully grasp the new market opportunities. Since this year, China Shanxi Guoxin Energy Corporation Limited(600617) automobile has entered a period of accelerated and large-scale growth. It is expected that the expansion of lithium battery production in the next year will remain at a historically high level. In addition, we expect that the overseas expansion is expected to speed up next year. As the main lithium battery rear section equipment supplier of Korean power battery enterprises, the company will face greater capacity pressure.
The company plans to issue shares to raise a total of no more than 2.312 billion yuan, of which 1.337 billion yuan is used to expand production, 303 million yuan is used to upgrade existing production capacity, and 252 million yuan is used to build overseas business network layout and basic R & D, assembly and manufacturing centers, which will alleviate potential production pressure in the future and strengthen overseas business layout.
The company has launched an equity incentive plan, and it is expected that the compound growth rate of net profit in the next three years will not be less than 54%. The performance unlocking conditions of the incentive plan are as follows: 1) the first unlocking period: Based on 2020, the growth rate of revenue or net profit in 2021 will not be less than 65% / 30% (i.e. RMB 2.5/484 billion respectively); 2) The second unlocking period: Based on 2020, the growth rate of revenue or net profit in 2022 shall not be less than 165% / 100% (i.e. RMB 4 / 744 million respectively); 3) The third unlocking period: Based on 2020, the growth rate of revenue or net profit in 2023 shall not be less than 300% / 280% (i.e. RMB 6 / 1.414 billion respectively). It is estimated that the share based payment expenses for this equity incentive from 2021 to 2023 will be RMB 0.3/1.0/0.5/0.2 billion respectively. After deducting the share based payment expenses, according to the above unlocking conditions, the net profit attributable to the parent company from 2021 to 2023 is expected to be RMB 454 / 640 / 1367 million respectively, with a three-year compound growth rate of about 54%.
Orders on hand are full, orders from overseas customers are expected to be gradually implemented, and the profit of the next year is expected to accelerate. Since the beginning of 2021, the company has full orders on hand, and the average profitability of orders is better than last year. It is expected that the amount of new orders signed by the company in the whole year is expected to exceed 5 billion yuan, and the profitability of next year is also better than this year. The performance of the next year is expected to accelerate. Major overseas customers such as LG and SK are gradually starting equipment bidding. It is expected that LG will accelerate the pace of production expansion after listing and financing, and the company is expected to fully benefit as an important global rear equipment supplier.
Profit forecast and investment suggestions
It is estimated that the net profit of the company from 2021 to 2023 will be RMB 450 / 730 / 1.42 billion respectively, with a compound growth rate of 56%, and the corresponding PE will be 94 / 58 / 30 times respectively, maintaining the “buy” rating.
Risk tip: the sales volume of new energy vehicles is lower than expected; Risk that the contract cannot be fully performed.
