\u3000\u3 Shengda Resources Co.Ltd(000603) 601 Chongqing Zaisheng Technology Co.Ltd(603601) )
Key investment points
Event: the company released] the annual report of 2021. The annual revenue was 1.62 billion yuan, up - 14% year-on-year, and the net profit attributable to the parent company was 250 million yuan, up - 30.6% year-on-year.
The main business maintained positive growth, and Q4 improved significantly month on month. In 2021, the company achieved a revenue of 1.62 billion yuan, with a growth rate of - 14%, of which the revenue of masks and meltblown materials was 30 million yuan, with a growth rate of - 89.1%. After deducting the masks and meltblown business, the company's revenue was 1.59 billion yuan, with a growth rate of 1%. Under the influence of multiple adverse factors such as the decline of pig cycle, the fluctuation of downstream user construction cycle, the tight international shipping capacity and the rise of freight, the company's main business still maintained positive growth. In terms of sectors, 1) the clean air sector achieved an annual revenue of 900 million yuan, with a growth rate of - 30%. After deducting masks, the revenue was 860 million, with a growth rate of - 10.1%. Among them, the revenue of clean air materials (excluding masks) was 470 million, with a growth rate of - 9.9%, mainly due to the obstruction of exports; The revenue of clean air equipment was 400 million, with a growth rate of - 10.4%, mainly due to the slowdown in the construction of fresh air system in pig houses (contributing 100 million revenue in the whole year). 2) The annual revenue of the high-efficiency and energy-saving sector was 690 million, with a growth rate of 17%. Among them, the demand for battery partition business was strong. The company passed the certification of MP company, a world-famous battery partition enterprise, in 21 years, and began to supply in batch from the second half of the year. The volume and price of this sector increased both, and the annual sales volume was 813711 tons, with a growth rate of 18.1%. Quarterly, the company's Q1-Q4 performance growth rate was 25.1%, - 62.1%, - 50.9% and 48% respectively, and Q4 improved significantly month on month.
Profitability is under pressure at different stages. In terms of gross profit margin, the company's gross profit margin in 21 years was 31%, with a year-on-year decrease of 7.1pp. The decline in comprehensive gross profit margin (mainly due to the large decline in the profit of clean air business) is due to the large change in product structure and the sharp reduction of mask melting and spraying business with high gross profit, as well as the rise in the price of raw materials and sea freight. In terms of business, the gross profit margin of the company's clean air sector was 36%, a year-on-year decrease of 11.1pp, of which the gross profit margin of the equipment sector was 28.1%, a year-on-year increase of 1.9pp; The gross profit margin of the energy-efficient sector was 24.4%, with a year-on-year increase of 6.3pp. In terms of expense rate, the annual expense rate of the company was 15.7%, with a year-on-year increase of 2.8pp, of which the management and R & D expense rate increased by 0.9 and 1.7 percentage points respectively year-on-year. In terms of cash flow, the net operating cash flow of the company in 2021 was 150 million yuan, a year-on-year decrease of 140 million yuan, and the cash content of net profit was 59%, a year-on-year decrease of 15pp, mainly due to the large sales receipts of masks and meltblown materials in the same period last year.
The performance is gradually out of the bottom and has long-term competitiveness Chongqing Zaisheng Technology Co.Ltd(603601) based on new materials, it has realized the integrated layout of horizontal and vertical industrial chains in the field of clean air, with high barriers to scale, cost, R & D and customers, a stable leading position and long-term competitive strength. In the whole year of 21, due to the overlapping of adverse factors such as the decline of mask and melt spray business, the slowdown of pig house construction and the tension of global shipping, the company's operation entered the bottom range, and Q4 began to return to positive growth. Looking forward to 2022, the company's production and operation activities will return to normal, and the two major capacity projects are expected to be put into operation in Q2, further boosting the growth of the company's production and marketing scale.
Profit forecast and investment suggestions. It is estimated that the net profit attributable to the parent company in 202224 will be 360 million yuan, 450 million yuan and 540 million yuan respectively, and the corresponding PE will be 18, 14 and 12 times respectively. As the absolute leader in the field of clean air, the company's long-term competitiveness has not weakened. The superimposed performance has gradually stepped out of the bottom range, continued to be optimistic, and maintained the "buy" rating.
Risk warning: the downstream market development is less than the expected risk; Risk that the production capacity construction progress is less than expected; The recovery of maritime transport capacity is less than the expected risk.
