\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 660 Fuyao Glass Industry Group Co.Ltd(600660) )
2021 performance disclosure: in 2021, the operating revenue increased by 18.6% year-on-year to RMB 23.6 billion (about 3.2% lower than our expected RMB 24.39 billion), and the net profit attributable to the parent increased by 21.0% year-on-year to RMB 3.15 billion (about 10.9% lower than our expected RMB 3.53 billion), It is mainly due to the decline of gross profit margin caused by the rise of sea freight / soda ash and other raw material costs (the gross profit margin of the new standard decreased by 0.6pcts to 35.9% year-on-year; among them, sea freight / soda ash dragged down the gross profit margin by nearly 1.0pcts/0.5pcts respectively).
Improved product structure and stable business in China: in 2021, the sales volume of Fuyao auto glass increased by 15% year-on-year, the average selling price increased by 3.8% (the proportion of high value-added products increased by 3.3pcts year-on-year), and the main business income increased by 18.4% year-on-year, The gross profit margin decreased by 0.8pcts to 35.3% year-on-year (among which, the revenue of automobile glass increased by 19.2% year-on-year, and the gross profit margin decreased by 1.6pcts to 30.7%; the revenue of China's main business increased by 14.4% year-on-year, and the gross profit margin increased by 1.4pcts to 43.0% year-on-year vs. the revenue of overseas main business increased by 23.3% year-on-year, and the gross profit margin decreased by 2.7pcts to 27.0%), and the cost rate of sales management and research of the new standard decreased by 1.6pcts to 17.3% year-on-year, The net profit attributable to the parent company after deducting non profits increased by 22.2% year-on-year to RMB 2.82 billion (the exchange loss increased by 25.0% year-on-year to RMB 530 million), and the annual dividend distribution ratio was as high as 81.3%.
Optimistic about the lean operation management and control ability, and the growth logic remains unchanged: we judge that 1) the performance of 4q21 Fuyao is dragged down by the expansion of Sam losses, exchange rate fluctuations and the rise of sea freight / raw materials and other costs; At present, the industry is still affected by the tight supply chain and repeated epidemics in some regions. The market is mainly worried about the climbing rhythm of capacity utilization and the rising costs of raw materials and sea freight. 2) We expect that the sea freight may remain high, but the possibility of further sharp rise will decline, and the price of soda ash may gradually fall; We are optimistic about Fuyao's lean operation management and control ability as the world's leading automotive glass supplier and the prospect of rising market share (we expect Fuyao's global OEM market share to be about 35% / 40% in 2023e / 2025e, and am market share to be about 30% / 40% in 2023e / 2025e in China). 3) We are optimistic about the rising penetration rate of ceiling / head up display driven by intelligent electrification, and the continuous increase in the proportion of high value-added functions such as edging products / sound insulation / heat insulation / HUD / dimming / atmosphere lamp / Cecep Solar Energy Co.Ltd(000591) and driven Fuyao's long-term performance will boost the prospect. 4) Fuyao is expected to be limited by the drag of Russian factories caused by the conflict between Russia and Ukraine.
Maintain the "buy" rating of a / H shares: in view of the risk of exchange rate and cost fluctuation, the net profit attributable to the parent company of 2022e / 2023e is reduced by 9% / 11% to RMB 4.08 billion / 5.02 billion, and the net profit attributable to the parent company of 2024e is expected to be about RMB 5.91 billion. In view of market risks, the target price of A-Shares was lowered to RMB 50.42 and the target price of H shares was lowered to HK $42.38 (A / h corresponds to 32x / 22x 2022e PE respectively). At present, the dividend yield of a / H shares is about 3.5% / 5.3% 2022e; Optimistic about the company's growth logic and growth prospects, and maintain the "buy" rating of a / H shares.
Risk warning: the supply chain shortage is alleviated less than expected; The ramp up of capacity utilization is lower than expected; The application proportion of high value-added products increased less than expected; The rise of market share is less than expected; Cost control is less than expected; The gross profit margin is lower than expected; Sam continues to drag down risks; exchange-rate risks; Epidemic recurrence and market risk
