\u3000\u3 Shengda Resources Co.Ltd(000603) 806 Hangzhou First Applied Material Co.Ltd(603806) )
Key investment points
In 2021, the company’s net profit attributable to the parent company was 2.197 billion yuan, with a year-on-year increase of 40%; the company issued its annual report for 2021, and achieved an operating revenue of 12.858 billion yuan during the reporting period, with a year-on-year increase of 53.20%; The total profit was 2.469 billion yuan, a year-on-year increase of 38.57%; The net profit attributable to the parent company was 2.197 billion yuan, a year-on-year increase of 40.35%. In 2021q4, the operating revenue was 3.928 billion yuan, a year-on-year increase of 34.35% and a month on month increase of 22.22%; The net profit attributable to the parent company was 860 million yuan, with a year-on-year increase of 24.01% and a month on month increase of 98.83%, which was much higher than the market expectation, mainly due to the significant increase in the single average profit of adhesive film. In 2021, the gross profit margin was 25.06%, a year-on-year decrease of 3.30pct, and in 2021q4, the gross profit margin was 29.94%, a year-on-year decrease of 5.51pct and a month on month increase of 11.14pct; In 2021, the net interest rate attributable to the parent company was 17.08%, a year-on-year decrease of 1.56 PCT, and in 2021q4, the net interest rate attributable to the parent company was 21.90%, a year-on-year decrease of 1.83 PCT and a month on month increase of 8.44 PCT.
The profit of single flat of adhesive film exceeded the market expectation, and longyi’s position was stable: the sales volume of photovoltaic adhesive film of the company was 970 million flat in 2021, an increase of 11% with the corresponding market share of 55% +, and longyi’s position was stable. The sales volume of 2021q4 is 236 million square meters, with a month on month ratio of – 14% / – 15%, which is mainly caused by the reduction of output due to the digestion of inventory by 2021q4 component factory. In 2021, the gross profit margin of adhesive film was 25.66%, including 31% in 2021q4, with a ring increase of 12pct, corresponding to a single average net profit of 3.2-3.3 yuan / square, which greatly exceeded the market expectation. Reasons: 1) in September 2021, due to strong demand, the adhesive film increased by 40%, and then the price decreased slowly. We calculated that the average price of 2021q4 was 15.3 yuan / square, with a ring increase of about 40%; 2) The price of raw material particles 2021q4 decreased from 30000 yuan to 20000 yuan, and the company has low-cost particle inventory reserves, so it can fully enjoy the profit increase brought by low-cost inventory; 3) The three fees control ability is strong, and the three fee rate in 2021 is only 1.23%.
In 2022, the adhesive film industry will benefit from the growth and the profit structure will continue to improve: we expect that the installed capacity of the photovoltaic industry will be 240gw + in 2022, corresponding to the demand for adhesive film of 2.5-2.6 billion square meters, an increase of about 45% at the same time. We expect that in 2022, the company will ship 1.4 billion Ping +, with a market share of about 55%, and fully enjoy the growth of the industry. At the same time, the proportion of high profit products such as white film + POE / EPE will be increased to 50%, and the company will launch anti-corrosion abishou series adhesive films, which will continue to improve the profit structure.
The sales volume of backplane increased steadily, and the photosensitive dry film opened the sales of medium and high-end products: in 2021, the sales volume of photovoltaic backplane of the company was 68 million square meters, an increase of 20% at the same time, of which the sales volume of 2021q4 was about 21 million square meters, with a month on month ratio of + 31% / + 31%. The production capacity of 110 million square meters in Jiaxing was gradually put into operation in the second half of 2021, and will still grow rapidly in 2022. In 2021, the sales volume of photosensitive dry film was 100 million square meters, an increase of 136% at the same time. The company has started the sales of medium and high-end products and improved the structure. The production expansion of 400 million square meters of photosensitive dry film and 24000 tons of alkali soluble resin in Jiangmen base has been gradually promoted, and the scale effect + self supply of core raw materials will also promote the further increase of gross profit margin. With the implementation of the company’s strategy of expanding new material product system based on key common technology platform, new materials such as FCCL, aluminum-plastic composite membrane and water treatment membrane will continue to contribute to performance increment in the future.
Profit forecast and investment rating: Based on the good prosperity of the photovoltaic industry, the firm’s leading position and the continuous optimization of product structure, we raised the company’s profit forecast. We expect the net profit attributable to the parent company to be RMB 2.89/3.58/4.25 billion from 2022 to 2024, and the value before 2022 to 2023 to be RMB 2.53/3.35 billion, with a year-on-year increase of 31.6% / 23.7% / 18.8%, corresponding to EPS of RMB 3.04/3.76/4.46/share, maintaining the “buy” rating.
Risk tips: competition intensifies, policies are less than expected, etc.
