\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 660 Fuyao Glass Industry Group Co.Ltd(600660) )
Matters:
The company disclosed in the annual report of 2021 that in 2021, the operating revenue was 23.603 billion yuan (+ 18.57%), the net profit attributable to the parent company was 3.146 billion yuan (+ 20.97%), the net profit deducted from non attributable to the parent company was 2.816 billion yuan (+ 22.22%), and the earnings per share was 1.23 yuan (+ 18.27%). The dividend plan is to distribute a cash dividend of 10 yuan (including tax) for every 10 shares.
Ping An View:
The revenue of automotive glass is better than that of the automotive industry, and the proportion of high value-added glass has increased. In 2021, the company sold 118.46 million square meters of automotive glass, with a year-on-year increase of 14.78%, including 96.69/21.77 million square meters of vehicle accessories and after-sales market, with a year-on-year increase of 12.86% / 24.12% respectively. The company’s auto glass revenue was 21.38 billion yuan, a year-on-year increase of 19.16%, far exceeding the growth level of production and sales in the auto industry. The proportion of high value-added products such as intelligent panoramic sky glass, dimmable glass, head up display glass, ultra insulating glass, lightweight ultra-thin glass and coated heating glass continued to increase, accounting for 3.31 percentage points higher than that in 2020. The unit price of auto glass keeps increasing. In 2021, the unit price of auto glass of the company was 180.48 yuan / m2, up 6.64 yuan / m2 year-on-year in 2020, maintaining an upward trend.
The increase of raw and auxiliary materials and shipping costs led to the decline of gross profit margin. In 2021, the exchange loss was 530 million (420 million in 2020). If the exchange gain or loss is deducted, the total profit will increase by 23% year-on-year. In 2021, the company’s gross profit margin was 35.9%, a year-on-year decrease. Among them, the gross profit margin of automotive glass business was 30.66%, and the decline was mainly affected by the rise of sea freight and soda ash price. Among them, the year-on-year rise of sea freight was RMB 231 million, which affected the decrease of gross profit margin by 0.98 percentage points, and the year-on-year rise of soda ash was RMB 107 million, which affected the decrease of gross profit margin by 0.45 percentage points. In 2021, the company’s net interest rate reached 13.3% (13.05% in 2020). In terms of expenses, the company’s sales / management expenses increased by 9.5% / 2.3% year-on-year in 2021, the R & D expenses increased by 22.3% year-on-year to 1 billion yuan, and the company’s financial expenses increased by 39.0% year-on-year, mainly due to the increase of exchange losses and the decrease of interest income caused by the appreciation of RMB. In terms of capital expenditure, the company’s capital expenditure in 2021 was 2.329 billion yuan.
Fuyao America’s earnings improved. Fuyao American company’s operating revenue in 2021 was 3.896 billion yuan, a year-on-year increase of 19.7%, basically returning to the level of 3.907 billion yuan in 2019. Fuyao America’s net interest rate reached 7% in 2021, and its annual net profit was 273 million yuan, a year-on-year increase of 93.4 times, an increase of 181.2% compared with 2019.
The intellectualization of automobile makes glass become the carrier of many new technologies, and the value of single car glass has great room for growth. The automobile market has entered a new development stage of diversified demand and structural optimization. The penetration rate of new energy vehicles is increasing, and the automobile is changing to a mobile intelligent terminal. The development of the new four modernizations of automobile makes more and more new technologies integrated into automobile glass, puts forward new requirements for automobile glass, and promotes the development of automobile glass in the direction of “safety and comfort, energy conservation and environmental protection, beauty and fashion, and intelligent integration”. The proportion of high value-added products such as intelligent panoramic sky curtain glass, dimmable glass, head up display glass and super insulated glass is increasing. In the future, the area and value of single car glass can be greatly improved.
Profit forecast and investment suggestion: the company’s overseas income is high, and the raw and auxiliary materials have increased a lot since the beginning of 2022. The rising trend of sea freight continues. In the first quarter of 2022, the main engine plant is still trapped in the shortage of supply chain, resulting in insufficient capacity utilization. These factors make the company’s operation need to face great challenges in 2022. According to the latest situation, we lowered the company’s performance forecast for 2022 / 2023 and gave the performance forecast for 2024 for the first time, that is, the net profit forecast for 2022 / 2023 / 2024 was RMB 4.003/51.37/6.179 billion (the original net profit forecast for 2022 / 2023 was RMB 5.104/6.492 billion). Considering that Fuyao Glass Industry Group Co.Ltd(600660) as the leading enterprise of automotive glass in the world, the market share of Fuyao Glass Industry Group Co.Ltd(600660) continues to increase, and the company is in a leading position in the automotive glass industry. It will continue to benefit from the transformation of the new four modernizations of automobiles and the rise of the value of single vehicle glass. It is optimistic about the long-term development space of the company and maintain the “recommended” rating.
Risk tips: 1) the shortage of chips in the automotive industry and the rise in the price of raw materials lead to lower than expected auto sales, which will affect the company’s performance; 2) Affected by geopolitical fluctuations, the price of bulk commodity raw materials has risen, which has led to a rise in the cost of the company’s automotive glass; 3) Exchange rate fluctuation: the company’s overseas sales business accounts for about half, and the scale is expanding year by year. If the exchange rate fluctuates greatly, it will have an impact on the company’s performance; 4) The penetration rate of high value-added products is lower than expected, affecting the company’s performance.
