\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 210 Shanghai Zijiang Enterprise Group Co.Ltd(600210) )
Event overview
The company released its annual report for 2021. In 2021, the company achieved a revenue of 9.529 billion yuan, a year-on-year increase of 13.2%; The net profit attributable to the parent company was 553 million yuan, a year-on-year decrease of 2.13%; The net profit attributable to the parent company after deduction was 533 million yuan, a year-on-year decrease of 0.51%. In a single quarter, Q1 / Q2 / Q3 / Q4 achieved revenue of RMB 2.254/26.17/24.02/2.256 billion respectively in 2021, with a year-on-year increase of 21.59% / 2.12% / – 5.86% / 55.58%; The net profit attributable to the parent company was 124 / 206 / 100 / 123 million yuan, with a year-on-year increase of 191.61% / – 0.05% / – 47.66% / – 1.63%.
Analysis and judgment:
Revenue side: most businesses are growing rapidly
The company’s traditional business continues to consolidate market share and actively explore new customers. During the reporting period, the company realized the business growth of Coca Cola system, expanded the supply category of blue moon, and successfully put into operation new cooperation projects with Guangming, Mengniu, CASS and so on. At the same time, the company has also opened up new customers such as Zhengqi and Naiqi forest. In terms of specific products, the company’s pet bottles and bottle embryos, crown caps and labels, color paper packaging and printing, OEM drinks and plastic anti-theft caps have been realized respectively
15.8/14.2/17.34/7.96/503 million yuan of revenue, an increase of 15.7% / 29.82% / 14.23% / 24.53% / 20.34%. The company’s new materials business also maintained rapid growth, of which the aluminum-plastic film business achieved a revenue of about 365 million, with the fastest growth rate of 58.11%.
Profit side: the rise of raw material prices and other factors lead to the decline of profit margin
In terms of profitability, the gross profit margin of the company in 2021 fell by 0.16pct to 21.2% year-on-year, and the net profit margin fell by 0.74pct to 6.32% year-on-year. In terms of specific products, the gross profit margin of the company’s aluminum-plastic film products decreased by 2.75pct to 32.44%, the gross profit margin of crown cover and label products decreased by 2.54pct to 12.65%, the gross profit margin of color packaging and printing products decreased by 1.86pct to 20.57%, and the gross profit margin of FMCG commerce and trade decreased by 0.61pct to 9.33%. The gross profit margin of PET bottles and bottle embryos increased by 3.95pct to 32.22%. The decline of the company’s overall gross profit margin is mainly due to the rise of raw material prices and the sharp increase of land value-added tax.
In terms of expenses, the company’s expense rate in 2021 was 12.77%, a year-on-year decrease of 0.13pct. The sales expense ratio was 2.3%, down 0.29pct year-on-year. The management fee rate was 6.17%, a year-on-year decrease of 0.01pct (there was social security exemption in the same period last year). The financial expense ratio was 1.17%, a year-on-year decrease of 0.31pct, while the R & D expense ratio increased by 0.49pct to 3.13%, mainly due to the company’s increased R & D investment, resulting in the increase of material investment.
Introducing ATL and Byd Company Limited(002594) as strategic investors, the volume and price of the company’s aluminum-plastic film business increased simultaneously
Zijiang new materials, a subsidiary of the company, has established stable cooperative relations with ATL, Byd Company Limited(002594) , Guangzhou Great Power Energy&Technology Co.Ltd(300438) , Do-Fluoride New Materials Co.Ltd(002407) and other well-known manufacturers, and introduced ATL and Byd Company Limited(002594) two leading enterprises in 3C and power battery industries to become strategic investors of Zijiang new materials in the second half of 2021. At the beginning of 2021, Zijiang new materials entered the Byd Company Limited(002594) DMI blade battery supply chain and opened the application scenario of Chinese soft pack lithium battery materials in square lithium batteries. The company’s annual sales volume of aluminum-plastic film reached 22.168 million square meters, an increase of 48.8% over 2020, of which the sales volume of aluminum-plastic film for power energy storage soft packed lithium battery accounted for 55%. At the same time, the sales price of the company’s aluminum-plastic film products also increased by 5.5% compared with the same period last year. At present, the design capacity of the company’s aluminum-plastic film has reached 36.6 million square meters, and the capacity utilization rate has reached 70.9%. We believe that in the future, the company will fully seize the industry opportunities, grasp the leading edge of technology, accelerate the consolidation of market position, take technology as the driving force, expand the share of domestic substitutes in the product market, continuously tap the customer needs in various segments and carry out continuous technology upgrading and product iteration through customer cooperation and rich product experience.
Investment advice
We are optimistic about Shanghai Zijiang Enterprise Group Co.Ltd(600210) . As a leader in China’s packaging material printing industry, the company has always been an excellent supplier of Coca Cola, Pepsi Cola, Unilever and many other well-known enterprises at home and abroad. The company began to set up an aluminum-plastic film team in 2004. It is the first enterprise in China to develop aluminum-plastic film technology and have mass production capacity. Its development process is also the closest to that of Japan and South Korea, and has the conditions to become the leader of domestic aluminum-plastic film. Benefiting from the domestic substitution and the rapid development of the downstream new energy vehicle industry, combined with the release of the company’s new production capacity, the performance is expected to continue to grow rapidly. Considering that the growth rate of the company’s revenue in 2021 slightly exceeded our expectations, we raised the forecast of the company’s revenue of 10.369/12.247 billion yuan in 2022 / 2023 to 10.571/12.282 billion yuan, and the revenue in 2024 was 14.164 billion yuan. At the same time, considering that the current commodity price continues to be high, which may have a partial negative impact on the company’s future profitability, the company lowered the prediction of EPS of 0.51/0.63 yuan in 2022 / 2023 to 0.41/0.50 yuan, and EPS of 0.61 yuan in 2024. Corresponding to the closing price of 6.22 yuan / share on March 18, PE is 15.31/12.35/10.19x respectively. Maintain the company’s “buy” rating.
Risk tips
1) macroeconomic fluctuations lead to lower downstream demand than expected; 2) The price change of raw materials leads to the decline of the company’s profitability; 3) The development of emerging business is less than expected.
