\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 973 Baosheng Science And Technology Innovation Co.Ltd(600973) )
Core view
Event: the company issued the 2021 annual report. On March 15, the company released its annual report for 2021, which showed that the company achieved an operating revenue of 42.878 billion yuan in 2021, a year-on-year increase of 25.07%; The net profit attributable to the parent company was -763 million yuan, a year-on-year decrease of 435.91%. The company’s net profit attributable to the parent decreased significantly, mainly due to the impact of the provision for credit impairment of RMB 1.299 billion in 2021.
High prosperity of offshore wind power, high value of submarine cables and high industrial barriers: 1) after rush loading, the prosperity of offshore wind remains the same, the bidding price of wind turbines continues to decline, and the price of offshore wind is expected to be parity in 2023. In terms of installed capacity, sea breeze bidding can exceed 100gw during the 14th Five Year Plan period, and coastal provinces have successively issued support policies. Even assuming that only half of the bidding is converted into installation, the installed capacity of 50gw sea breeze is calculated according to the corresponding submarine cable value of 2 billion yuan per GW, and the scale of submarine cable industry during the 14th Five Year Plan period will not be less than 100 billion yuan. Moreover, the sea breeze is far-reaching, and Haihua will further increase the demand for submarine cables per unit installed capacity. 2) The barrier of submarine cable business is high, and the resource endowment advantage of the company is obvious: there are five barriers in the field of submarine cable, including wharf, tower, technology, construction qualification and past performance, which are very difficult for general cable enterprises to enter.
The company relies on advantageous resources to enter the submarine cable business, and its profitability is expected to be greatly improved. 1) High profitability of submarine cable: in 2021, the company’s submarine cable business achieved a revenue of 1.509 billion yuan, with production and sales of 702 and 627 kilometers respectively. The gross profit margin of the company’s submarine cable business is 38.66%, significantly higher than all other main businesses of the company. Once the submarine cable business is in large volume, it can significantly improve the profitability of the company. 2) Relying on its own background as a central enterprise of AVIC, the company joined hands with Yangtze Optical Fibre And Cable Joint Stock Limited Company(601869) optical cable to enter the submarine cable business in 2020. In terms of resource endowment, the company has the largest 50000 ton submarine cable Wharf in China and the highest 201 meter cross-linked tower in China in Yangzhou; In terms of production capacity, the production capacity of Yangzhou submarine cable base of the company will be put into operation in an orderly manner, which will significantly improve the profitability of the company in the future.
Large value accrual has been implemented, and a number of businesses have made concerted efforts. The company is a leading enterprise in the field of wire and cable in China, and its business scope covers UHV, new energy, communication and aerospace. We expect the company to achieve revenue of 44.658/46.635/48.653 billion yuan and net profit attributable to the parent company of 495/6.07/697 million yuan from 2022 to 2024, corresponding to pe13.5 million yuan 26 / 10.82/9.42 times, maintaining the “overweight” rating.
Risk warning: price fluctuation of raw materials; Sea breeze bidding is less than expected; The market competition pattern has deteriorated.
