Tongwei Co.Ltd(600438) (600438)
Key investment points
Event: the company issued the announcement of performance increase in 2021. In 2021, the company expects to realize a net profit attributable to the parent company of 8-8.5 billion yuan, an increase of 4.392-4.892 billion yuan over 2020, a year-on-year increase of 122% - 136%; The non net profit deducted was 8-8.5 billion yuan, an increase of 5.591-6.091 billion yuan over 2020, a year-on-year increase of 232% - 253%. In the fourth quarter alone, the net profit attributable to the parent company was RMB 2-2.5 billion, which decreased slightly month on month due to the partial withdrawal in the fourth quarter, the increase of management expenses and the off-season factors of feed. The performance increase in 2021 is in line with expectations.
In the fourth quarter of 2021, the silicon material price remained at a high level of more than 200000 yuan / ton, and maintained high profitability throughout the year. In the fourth quarter, the tight balance of silicon material supply continued, and the company's polysilicon continued to be fully produced and sold. In terms of output, we expect the company's silicon material sales in the fourth quarter to be about 25000 tons, the annual sales volume to be about 95000 tons, and the capacity utilization rate to exceed 100%. In terms of price, the upstream industrial silicon price in the fourth quarter was still relatively high, and the overall silicon supply was tight. The company's silicon material sales price rose month on month, and the average sales price is expected to be about 240000 yuan / ton.
Leshan phase II and Baoshan phase I projects are put into operation as scheduled, and the production capacity is put into operation first, which will fully enjoy the high price dividend of silicon material. 51000 tons of Leshan phase II (including 1000 tons of electronic grade) and 50000 tons of Baoshan phase I have been put into operation. At present, the total capacity has reached 180000 tons, ranking the first in the industry. 22q1 has started new capacity and gradually contributed to the increment. It is expected to reach full capacity in February. The cost of new capacity was further optimized. With the start-up of downstream demand and the increase of operating rate, we believe that the price decline of 22h1 silicon material will be relatively limited, and the price will remain high compared with the historical price. The company took the lead in putting in production capacity to contribute to the output increment, while the production cost continued to decline, and the profit level of silicon material in 22 years was still good.
In the past 22 years, the large-size battery or structure was tight, and the battery profit improved. The battery business of 21q4 company continued to maintain full production and sales, the unit profitability improved, the proportion of 210 size shipments further increased, and accelerated the market process of large-size products. We believe that the imbalance of the upstream and downstream capacity structure of the industrial chain and the uncertainty of the expansion of new battery technology will lead to the tight supply of large-scale battery capacity in 22 years, superimposed with factors such as loose silicon price, and strong certainty of battery profit repair. In 2022, the company's total battery capacity will exceed 55gw, of which the capacity of 210 large-size batteries will exceed 35gw. The leading position of capacity scale is stable, which fully ensures the company's large-size battery shipping capacity, and the profit of battery business is expected to rise further.
Profit forecast and investment suggestions: it is expected that the supply and demand of silicon materials will be in tight balance in 2022, the price of silicon materials will continue to maintain a high level, and the profitability of the battery industry will improve in the future. We raised the net profit attributable to the parent company in 2022 to 14.3 billion yuan, gave the company 25 times PE in 2022, the target price of 79.5 yuan, and maintained the "buy" rating.
Risk tip: the high price of silicon material affects the downstream installed demand; The risk that the company's new silicon material and battery capacity is not put into operation as planned.
