\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 865 Flat Glass Group Co.Ltd(601865) )
Events
Flat Glass Group Co.Ltd(601865) released the 2021 annual report. In 2021, the company realized an operating revenue of 8.713 billion yuan, an increase of 39.18% at the same time; The net profit attributable to the parent company was 2.120 billion yuan, an increase of 30.15% at the same time; Deduct the net profit not attributable to the parent company of RMB 2.055 billion, an increase of 26.92% at the same time. The corresponding revenue of 2021q4 was 2.376 billion yuan, with a ring increase of 2.89%; The net profit attributable to the parent company was 403 million yuan, a decrease of 11.57%.
Key investment points
The sales volume continued to increase and the production capacity further expanded
In 2021, the company sold 265 million square meters (YoY + 43.2%), the average price including tax was 30.4 yuan (yoy-4.8%), the sales revenue was 7.122 billion yuan (YoY + 36.3%), and the sales volume continued to grow rapidly. As of December 31, 2021, the total production capacity of the company is 12200 tons / day, which is converted into 3.2mm glass. At present, the annual production capacity of the company is 557 million square meters. In 2022, the company will release seven 1200 T / D photovoltaic glass production capacity. By the end of the year, the total production capacity of the company will be 20600 T / D, equivalent to an annual production capacity of 940 million square meters. In addition, the company announced in March 2022 that it would invest in the construction of six photovoltaic glasses with a daily melting capacity of 1200 tons in Nantong, and the ignition time is expected to be from 2023 to 2024. At present, the company and Xinyi solar energy are in the first echelon of the photovoltaic glass industry. The market share of the two companies is more than 50%. With the further expansion of production capacity, the market share is expected to be further improved.
Pressure on performance in the fourth quarter
In terms of profitability, the company’s 2021q4 revenue was 2.376 billion yuan, with a ring increase of 2.89%; The net profit attributable to the parent company was 403 million yuan, with a ring down of 11.57% and a gross profit margin of 17.91%. The company’s profit was at the bottom of the stage, which was mainly affected by the rise of freight prices, raw material and fuel costs and the low operating rate in the fourth quarter. Throughout the year, the comprehensive gross profit margin in 2021 was 35.5%. Considering the changes of accounting standards, the gross profit margin in the same period last year was 42.5%, down 6.99pcts; The gross profit margin of photovoltaic glass was 35.7%, down 9.22 PCTs. Although the company’s profitability has declined slightly, it still has great advantages over second and third tier enterprises. It is expected that the profitability of the company is expected to improve with the warming of downstream photovoltaic installation demand and the gradual recovery of photovoltaic glass price.
Layout the quartzite mines in the upstream to improve the self-sufficiency rate
At present, the company has completed the acquisition of all shares of Sanli mining and Dahua mining, and is expected to obtain more than 40 million tons of quartzite resource reserves, which ensures the sand demand and quality safety of the company’s production base, reduces the company’s dependence on external purchase of quartz sand, and the self-sufficiency rate of quartz sand will be greatly improved.
Profit forecast
We predict that the company’s revenue from 2022 to 2024 will be 15.462 billion yuan, 22.565 billion yuan and 26.966 billion yuan respectively, and its EPS will be 142, 2.13 and 2.59 yuan respectively. The current share price corresponds to 34, 22 and 18 times of PE respectively, giving it a “recommended” investment rating.
Risk tips
The PV installation failed to meet the expectations, the expansion of the company’s glass production failed to meet the expectations, the shortage of raw material soda ash, the decline in the price of PV glass, etc.
