\u3000\u3 Shengda Resources Co.Ltd(000603) 055 Zhe Jiang Taihua New Material Co.Ltd(603055) )
The company issued the performance express for 2021, during which the revenue was 4.265 billion yuan (+ 70.52%), the net profit attributable to the parent company was 465 million yuan (+ 287.95%), and the net profit attributable to the parent company after deduction was 446 million yuan (+ 363.32%). Among them, Q4 achieved a revenue of 1.197 billion yuan (+ 44.04%), a net profit attributable to the parent company of about 87 million yuan (+ 220.48%), and a net profit attributable to the parent company of 88 million yuan (+ 293.76%) after deduction.
Under the large volume of differentiated new production capacity, the annual performance is beautiful. During the period, under the gradual large-scale production of 120000 tons of differentiated nylon filament, the annual revenue and profitability of the company increased significantly. The gross profit margin in the first three quarters of 2021 was 26.44% (+ 2.05pcts) and the net profit margin was 12.29% (+ 6.79%). With full orders and production capacity, the annual net interest rate (10.89%) decreased compared with the first three quarters, mainly due to: 1) Q4 in previous years was off-season (Q4 performance in 20182020 was less than 30 million); 2) In 2021, the profit increased significantly, and the bonus is expected to increase significantly year-on-year; At the same time, the company's optimization of inventory structure and disposal of some non-performing assets also affect the current profit. However, the whole year is still significantly higher than that in 2020 (+ 6.33pcts).
The impact of short-term crude oil price rise is limited, and the capacity utilization rate remains high. Since the beginning of the year, the prices of raw materials PA6 and PA66 chips have been + 3.9% / - 13.4% respectively, which is stable as a whole. We expect that the probability of significant cost increase in the future is small, mainly due to the continuous expansion of upstream caprolactam and adiponitrile in recent years. At the same time, as the leading enterprise in the field of civil nylon filament, the company has a certain bargaining power. From the demand side, the demand for the company's high-end differentiated products nylon 66 and recycled products is still strong, and the orders of traditional nylon 6 products are expected to rise with the increase of temperature. We expect that the current capacity utilization rate will remain high and the production and sales will be balanced.
The improvement of capacity utilization rate and yield rate will drive the continuous growth of performance in 2022. The production capacity of 120000 tons of differentiated nylon filament put into operation in 2021 is gradually released, and the annual capacity utilization rate is expected to be about 60% - 70%, which is expected to contribute to the whole year in 2022. At the same time, with the continuous improvement of the company's process, the yield of high-end nylon 66 is better than expected, which is expected to be about 70% by the end of 2021 and 75% by 2022.
The construction of new projects is smooth, opening up space for long-term growth. The company's new project was officially started in January 2022 and the equipment order was successfully implemented. According to the investigation, the current project construction process is smooth. The first batch of 60000 tons of high-end differentiated nylon 66 civil silk and 20000 tons of chemically regenerated nylon silk in phase I are expected to be officially put into production in 2023q1 / Q2 respectively, and the capacity utilization rate of that year may reach 50%. Terminal sports and outdoor brand customers have an urgent demand for PA66 differentiated silk and renewable nylon silk. After being put into operation, the growth of the company is expected to further accelerate.
The trend of high-end industry and domestic substitution is prominent, and the company's advanced layout and first mover advantage are prominent. 1. Nylon 66 is expected to accelerate penetration: all properties of nylon are better than polyester, showing a trend of gradually replacing polyester in the downstream civil textile field, especially for sportswear with high requirements for fabric functionality. Meanwhile, in the future, under the localization and mass production of raw material adiponitrile, the permeability of nylon 66 is expected to increase with the decline of raw material price in 2023, so as to accelerate the replacement of nylon 6 and polyester. 2. The blue ocean of renewable market is becoming more and more obvious: China's environmental protection policies are overweight, and clothing brands have an urgent demand for renewable energy. Nylon is still on the eve of global nylon industrialization. The company has laid out the above fields. It is one of the few enterprises in China that can produce high-end nylon 66 civil silk on a large scale. At the same time, it is also one of the few enterprises in the world with the renewable capacity of chemical nylon, with obvious first mover advantage.
Investment suggestion: the company is a leader in the integration of China's Nylon industrial chain. By focusing on the research and development of differentiated nylon silk and continuously improving the added value of products, it is expected to fully benefit from the high boom of the sports industry and the decline of raw material prices, which will drive the improvement of nylon application penetration in the downstream. At the same time, the company also has a first mover advantage in regenerated nylon, and is expected to enjoy the high prosperity dividend of the industry in the future. Considering the large investment in the early stage of the new project, the net profit of the company in 2022 / 2023 is expected to be 602 / 950 million yuan respectively (originally 640 / 1074 million yuan), an increase of 29% / 58% respectively, corresponding to the current stock price valuation of 17 / 11x, maintaining the "buy" rating.
Risk tip: capacity expansion is less than expected; The price of raw materials fluctuates greatly; Low expectation of raw material localization process; Downstream demand is lower than expected; The public materials used in the research report may have the risk of information lag or untimely update
