\u3000\u3 China Vanke Co.Ltd(000002) 050 Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) )
Key elements of the report:
The company released its annual report for 2021. During the reporting period, the company achieved a total operating revenue of 16.021 billion yuan, a year-on-year increase of 32.30%, a net profit attributable to shareholders of listed companies of 1.684 billion yuan, a year-on-year increase of 15.18%, and a net profit attributable to shareholders of listed companies of 1.487 billion yuan, a year-on-year increase of 17.07%.
Key investment points:
The performance is in line with expectations, mainly affected by the rising price of raw materials: in 2021, the company achieved a revenue of 16.021 billion yuan, a year-on-year increase of 32.30%, and the net profit attributable to shareholders of listed companies was 1.684 billion yuan, a year-on-year increase of 15.18%, which is basically in line with market expectations. The lower growth rate of net profit is mainly due to the continuous overseas epidemic and the continuous rise in the price of shipping and bulk raw materials, with a gross profit margin of 25.68%, A year-on-year decrease of 2.16pct (after retroactive adjustment of accounting standards). Quarter by quarter, 21q4 achieved a revenue of 4.301 billion yuan, with a year-on-year / month on month increase of 22.30% / 6.31% respectively. The net profit attributable to shareholders of listed companies was 391 million yuan, with a year-on-year / month on month increase of 5.67% / – 16.71% respectively.
The business of refrigeration and air conditioning appliances remained stable, and the business of auto parts and components grew rapidly: from the business situation, the traditional refrigeration and air conditioning appliance business maintained sustained and stable growth due to the development opportunities of refrigerant switching, energy efficiency upgrading, consumption upgrading and multi online and other related business products. In 2021, the business revenue of refrigeration and air conditioning appliance parts and components was RMB 11.218 billion, a year-on-year increase of 16.36%, but due to the rise in the price of raw materials such as aluminum, the gross profit margin was 26.46%, The year-on-year decline was 1.53pct. In addition, the company took the initiative to expand new fields such as kitchen and electric parts. The business of its subsidiary yaweko achieved continuous profitability in 2021 by relying on the popularization and acceleration of dishwashers in China and the transformation of internal supply chain; The auto parts business achieved an operating revenue of 4.802 billion yuan, up 94.50% year-on-year, mainly driven by the rapid development of new energy vehicle heat management business, with a gross profit margin of 23.85% and a year-on-year decline of 3.41 PCT, including 4.004 billion yuan of new energy vehicle heat management business, accounting for 83.07% of auto parts business. It is expected that with the rapid development of global new energy vehicles, the company’s auto parts business is expected to maintain rapid development.
Sustained high R & D investment consolidates the market leading advantage, abundant production capacity ensures the continuous high growth of performance: in 2021, the company invested 751 million yuan in R & D, with a year-on-year increase of 44.9%, accounting for 4.69% of revenue. The company strengthened its product strength through continuous R & D investment, so as to ensure the electronic expansion valve of air conditioner, four-way directional valve, solenoid valve, microchannel heat exchanger, vehicle electronic expansion valve, thermal management integrated components of new energy vehicles Omega pumps and other products have the largest market share in the world. In addition, the company has abundant orders and orderly promoted the production line construction of Mexican factory and Shaoxing Binhai factory in terms of auto parts business. By the end of 2021, the new energy heat management capacity was 26 million, the capacity utilization rate was 74.87%, and the construction project of 11.5 million sets of new energy auto parts per year has been completed and accepted. The abundant capacity is expected to ensure the continuous and high growth of new energy vehicle heat management business.
Profit forecast and investment suggestions: we expect the company to achieve revenue of 20.249 billion yuan, 24.579 billion yuan and 29.726 billion yuan from 2022 to 2024, net profit attributable to shareholders of listed companies of 2.216 billion yuan, 2.803 billion yuan and 3.551 billion yuan, EPS of 0.62 yuan, 0.78 yuan and 0.99 yuan respectively, and PE corresponding to closing price on March 25, 2022 are 27.1 times, 21.4 times and 16.9 times respectively. Considering the continuous high growth of the company’s new energy vehicle thermal management, the overweight rating is maintained.
Risk factors: the development of auto parts business is less than expected, the development of refrigeration, air conditioning and electrical business is less than expected, and the price of Volkswagen raw materials rises sharply.
