\u3000\u30003 China Zhenhua (Group) Science & Technology Co.Ltd(000733) 00073)
The company released the performance express of 2021 and the operation data from January to February of 2022, and the performance of the express increased by 163.07% year-on-year; From January to February 2022, the performance increased by about 202.21%. The company’s cathode products continue to increase in volume; Maintain the overweight rating.
Key points supporting rating
The profit in 2021 increased by 183.54% year-on-year: the company released the performance express in 2021, and preliminarily calculated that the annual profit was 1.091 billion yuan, with a year-on-year increase of 183.54%; Deduct non-profit 824 million yuan, a year-on-year increase of 238.37%. According to the calculation of the performance express, the company achieved a profit of 364 million yuan in Q4 in 2021, with a year-on-year increase of 202.48% and a month on month increase of 29.75%. After deducting non-profit of 310 million yuan, the company achieved a year-on-year increase of 176332% and a month on month increase of 38.98%. The company had previously predicted a profit of 1-1.05 billion yuan in 2021, and the express performance exceeded the upper limit of the forecast.
The amount of cathode materials increased rapidly, and the new production capacity was gradually released: the company’s lithium battery cathode material products had prominent competitive advantages in the market, and the demand for the company’s products from customers outside China increased rapidly. In 2021, the shipment of cathode materials is expected to be about 50000 tons, with a year-on-year increase of about 108.3%, and the net profit per ton is about 15000 yuan. Among them, the expected sales volume of 2021q4 is about 1500018000 tons, and the net profit per ton is about 16000 yuan. In 2022, the company’s Changzhou phase II production capacity of 50000 tons will be gradually released, the annual effective production capacity will exceed 100000 tons, and the shipment volume is expected to be 9 Shenzhen Ecobeauty Co.Ltd(000010) 0000 tons, which is conducive to the company’s continuous improvement of competitiveness.
From January to February 2022, the performance was bright, and the proportion of high nickel was gradually increased: the company issued the announcement of main business data from January to February 2022, and the operating revenue from January to February was about 2.348 billion yuan, a year-on-year increase of about 202.21%; The net profit attributable to the parent company was about 230 million yuan, with a year-on-year increase of about 113.91%. The company’s high nickel products are sold in batches to overseas customers, and the proportion is gradually increasing.
Actively guarantee the supply of raw materials: the company and Zhejiang Huayou Cobalt Co.Ltd(603799) signed a ternary precursor purchase agreement; Jointly with Cngr Advanced Material Co.Ltd(300919) to carry out the comprehensive development and utilization of laterite nickel ore in Indonesia, and invest in the construction of lithium iron phosphate related supporting projects in Guizhou. The supply and demand of products such as high nickel NCM precursors will reach 20 Fawer Automotive Parts Limited Company(000030) 0000 tons in the next three years.
Valuation
Under the current share capital, combined with the company’s announcement and the industry situation, we adjusted the company’s predicted earnings per share from 2021 to 2023 to 2.15/2.92/3.72 yuan (the original predicted diluted earnings per share was 1.54/2.02/2.65 yuan), corresponding to a price earnings ratio of 35.5/26.2/20.6 times; Maintain the overweight rating.
Main risks of rating
The new energy vehicle industry policy did not meet expectations; The product strength of new energy vehicles does not meet expectations; The demand of the industrial chain does not meet the expectation; The price competition in the industrial chain exceeded expectations; The impact of the epidemic exceeded expectations.
