\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 19 Cngr Advanced Material Co.Ltd(300919) )
In 2021, the net profit attributable to the parent company was 939 million yuan, with a year-on-year increase of 123%, which was in the middle of the performance forecast and in line with market expectations. In 2021, the company’s revenue was 20.072 billion yuan, a year-on-year increase of 169.81%; The net profit attributable to the parent company was 939 million yuan, a year-on-year increase of 123.48%; Deduct non net profit of 769 million yuan, with a year-on-year increase of 121.57%; In 2021, the gross profit margin was 11.54%, a year-on-year decrease of 1.6pct; In 2021, the net interest rate attributable to the parent company was 4.67%, a year-on-year decrease of 0.97pct. The company previously predicted that the net profit attributable to the parent company in 2021 was 908962 million yuan, and the annual report was in the middle of the performance forecast, which was in line with market expectations.
Downstream demand erupted in 2021, and the company’s precursor shipments increased rapidly, maintaining a high growth trend in 2022. In 2021, the company’s revenue of lithium cathode precursor materials was 20 billion yuan, with a year-on-year increase of 169.81%, gross profit rate of 11.54%, and a year-on-year decrease of 1.6pct, of which the revenue of ternary precursor was 15.36 billion yuan, with a year-on-year increase of 170.81%, gross profit rate of 12.26%, and a year-on-year decrease of 0.9pct; Co3O4 was 4.04 billion yuan, with a year-on-year increase of 180.15% and a gross profit margin of 9.17%, a year-on-year decrease of 2.39 PCT. In 2021, the company sold 176000 tons of positive precursors, a year-on-year increase of 93%, of which we expect the sales of ternary precursors to be 152300 tons, an increase of 110% +; Lithium cobaltate sold 23300 tons, an increase of 26% at the same time.
With the improvement of large-scale production and integration, the company’s profit level is generally upward. Q4 has dropped slightly due to the rise in the price of auxiliary materials, and the profit improvement trend in 2022 will not be changed. In terms of profitability, benefiting from the scale effect and the improvement of integration ratio, we estimate that the company’s single ton profit in 2021 will reach 4400 yuan / ton (excluding non-profit), an increase of 16% year-on-year. However, due to the impact of limited power production and the sharp rise of auxiliary material costs in the second half of the year, the net profit per ton decreased month on month. We estimate that the net profit per ton deducted from Q4 is about 2200 yuan / ton, a decrease of 50% month on month, It is mainly because the accrued bonus affects the net profit per ton of about 1700 yuan / ton, the average cost of superimposed Q4 liquid alkali increases by 600700 yuan / ton, and the phased impact of ternary cost is about 18002000 yuan / ton. If added back, the non single ton profit deducted from Q4 in 2021 will be nearly 6000 yuan / ton, with a month on month increase of 5-10%.
Technological advantages continue to take the lead, deeply bind international head battery enterprises, and high quality continues to grow. In 2021, the company’s ternary precursor 8 series and above products accounted for nearly 50%, high voltage and doped Co3O4 above 4.45v accounted for more than 80%, and the Chinese market share of high voltage Co3O4 materials exceeded 50%. The proportion of high nickel products of the company increased significantly, and the company made breakthroughs in cobalt free single crystal products, multiple 7 series products, 8 series products and 9 series products, Among them, cobalt free single crystal has completed batch certification and Factory review, and its technical advantages continue to be in the lead. The company has established stable cooperative relations with LG Chemical, Xiamen Tungsten Co.Ltd(600549) , Tesla, Beijing Easpring Material Technology Co.Ltd(300073) , beiteri, L & F, Guizhou Zhenhua E-Chem Inc(688707) , Tianjin BAMO, Samsung SDI and other customers.
China’s external production expansion and speed-up, vertical integrated layout, horizontal expansion of lithium iron phosphate and all-round development. By the end of 2021, the production capacity of ternary precursor of the company was about 200000 tons, and the production capacity of cobalt trioxide was about 30000 tons, which doubled compared with the beginning of the year. The 180000 ton ternary precursor raising and investment project of the southern base was under construction. With the 60000 ton western base put into operation in Q1 2022, the 35000 ton precursor material and recycling project of the central base and the 180000 ton production capacity of the southern base were completed and put into operation, The company expects that the company’s production capacity will exceed 500000 tons by 2023. We expect the company to ship 300000 tons + in the whole year, with a year-on-year increase of 70%.
Investment suggestion: considering the short-term pressure on profits caused by the rise in the cost of auxiliary materials, we adjusted the net profit attributable to the parent company from 2022 to 2024 to RMB 1.889/31.59/4.426 billion (originally predicted to be RMB 2.016/3.028 billion from 2022 to 2023), with a year-on-year increase of 101% / 67% / 40%. The corresponding current price PE is 38x / 22x / 16x respectively. 55xpe in 2022 is given, the corresponding target price is 171.6 yuan, and the “buy” rating is maintained.
Risk tip: the sales volume of electric vehicles is lower than expected, and the price of raw materials fluctuates.
