Comment on Eve Energy Co.Ltd(300014) event: the release of repurchase plan and employee stock ownership plan shows the confidence of enterprises

\u3000\u30 Jinzai Food Group Co.Ltd(003000) 14 Eve Energy Co.Ltd(300014) )

Event:

Eve Energy Co.Ltd(300014) synchronously issue share repurchase plan and employee stock ownership plan. The company plans to repurchase the company's shares with its own funds of 150 million to 300 million yuan, and the repurchase price shall not exceed 129.00 yuan / share (including this number). It is expected to repurchase 1163000 shares to 2326000 shares, accounting for 0.06% to 0.12% of the total share capital of the company, and the repurchase period shall not exceed 12 months. According to the ninth phase of the Eve Energy Co.Ltd(300014) employee stock ownership plan published in the same period, the upper limit of the total subscription fund is 180 million yuan, with "shares" as the subscription unit, each share is 1 yuan, the initial subscription limit of a single person is 10000, the maximum subscription limit is 20 million, and the upper limit of the number of shares is 180 million.

Key investment points:

Repurchase plan and employee stock ownership show the company's confidence in development. In March 2021, the company issued a repurchase plan with its own capital of 100 million yuan and the eighth employee stock ownership plan with a subscription limit of 42 million yuan in June 2021. This larger repurchase and employee stock ownership plan is based on the recognition of the company's internal value and confidence in the development prospect, binds the company's core employees and improves the company's core cohesion, And improve the company's long-term incentive and restraint mechanism to promote the long-term and healthy development of the company.

The cylindrical battery business has accelerated, and the consumer battery has gradually become dominant. The company has obvious leading advantages in consumer batteries, with strong price transmission ability compared with power batteries and relatively stable profit margin. The consumption of 18650 and 21700 cylindrical batteries has increased significantly, the cordless of overseas electric tools is clear, the replacement of lithium batteries for two wheeled vehicles is accelerated, and domestic enterprises represented by Yiwei in the battery link are rapidly seizing the market share. At present, the production capacity of cylindrical batteries has accelerated expansion, and the shipment volume is expected to double this year. The gross profit margin of lithium primary batteries is high, and the demand for offline batteries will continue to grow in the future. The demand for lithium primary batteries is expected to accelerate again. 3C consumer batteries are currently in the stage of increasing investment, and there may be new demand points in the future.

The layout of power battery industry chain is complete, and the profit turning point is approaching. Recently, the company signed the cooperation agreement on the whole industry chain project of new energy battery with Yuxi Municipal People's Government of Yunnan Province, Yunnan Energy New Material Co.Ltd(002812) , Huayou holding and Yunnan Yuntianhua Co.Ltd(600096) and the power battery industry chain has been continuously completed. Recently, the company accelerated the development of JIEZECHAKA Salt Lake and Dachaidan Salt Lake in cooperation with Sunresin New Materials Co.Ltd Xi'An(300487) to lay out the capacity of 10000 ton lithium hydroxide and lithium carbonate. With the launch of upstream cooperation capacity in the second half of this year, the supply and demand of superimposed materials are gradually balanced, and the profit inflection point is expected to come quickly.

Profit forecast and investment rating: the company benefits from the high penetration rate of new energy vehicles, which drives the rapid growth of power battery demand, the gradual increase of energy storage space, and the recovery of consumer battery demand. With the expansion of production capacity, the upstream production capacity also helps to enhance the profitability of the company. Affected by the company's equity incentive, amortization expenses of 56 million yuan, 651 million yuan and 350 million yuan will be generated in 2021, 2022 and 2023 respectively, reducing the expected value of the company's net profit attributable to the parent company. It is estimated that the operating revenue of the company from 2021 to 2022 to 2023 will be 17.801 billion yuan 29.649 billion yuan 59.280 billion yuan, and the net profit attributable to the parent company will be 3.080 billion yuan 3.573 billion yuan 6.548 billion yuan. The current stock price corresponds to PE of 47.05x 40.55x 22.13x, which is rated as "buy".

Risk tips: the capacity expansion is less than expected, the sales volume of new energy vehicles is less than expected, the price of raw materials continues to rise, and the production speed of new products is less than expected.

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