\u3000\u3 Guocheng Mining Co.Ltd(000688) 388 Guangdong Jiayuan Technology Co.Ltd(688388) )
Key investment points
Event: the company released its 2021 annual report. In 2021, it realized an operating revenue of 2.804 billion yuan, a year-on-year increase of 133%; The net profit attributable to the parent company was 550 million yuan, a year-on-year increase of 195%; The net profit deducted from non parent company was 497 million yuan, with a year-on-year increase of 204%. 21q4 achieved an operating revenue of 817 million yuan, an increase of 98% year-on-year and 4% month on month; The net profit attributable to the parent company was 156 million yuan, an increase of 123% year-on-year and 4% month on month; The net profit deducted from non parent company was 132 million yuan, an increase of 96% year-on-year and a decrease of 2% month on month. The performance is in line with expectations.
Copper foil thinning (≤ 6) μ m) As an inevitable trend, the company, as a leader, is expected to take the lead in benefiting. At present, energy density is an important parameter of vehicle specification power lithium battery. It is estimated that copper foil, as the key cathode material of lithium battery, is more high-end than 6 μ The unit consumption of M copper foil is about 620 tons / GWH, if replaced with 4.5 μ M copper foil can significantly increase the energy density of lithium battery by 5-10%, and then increase the driving range. Therefore, it has great market application value and application scenarios in the medium and short term. At present, there are few suppliers of very thin copper foil in China. As a product pioneer, the company has both technology and production capacity, and is expected to take the lead in benefiting from the process of copper foil thinning. In addition, the spot price of LME copper has been maintained at a historically high level since the exploration in early March this year. Therefore, in the short term, the ultra-thin copper foil with higher technical content and ultra-thin copper foil with higher unit copper content (> 6%) μ m) The price difference of copper foil will be greatly reduced or upside down, so that downstream customers have greater willingness to introduce the use of extremely thin copper foil.
Due to the bottleneck of equipment expansion, the supply of copper foil will continue to be tight. According to the announcements of copper foil suppliers, at present, the cathode roller, the core equipment of China’s copper foil production line, is mainly imported from Japan. The high-precision cathode roller is monopolized by a few enterprises such as Nippon Steel and Sumitomo, with an annual output of less than 300 units, corresponding to the new capacity of about 70000 tons / year of copper foil, which is far behind the capacity expansion speed of lithium battery, and may lead to a shortage of copper foil supply in the medium and short term. Therefore, as a few suppliers who can use domestic cathode rollers for production, the company will greatly lead its competitors in terms of production expansion speed and cost advantages, and is expected to take the lead in seizing the incremental market through active production expansion. The announcement shows that the capacity utilization rate of the company in recent three years is 110%, 95% and 125% (January September 2021), and the production and marketing rate is as high as 98%, 106% and 100% (January September 2021). The two indicators are full, reflecting the strong downstream demand, the continuous tight supply and demand, and forming a strong support for the processing fee.
Deep binding Contemporary Amperex Technology Co.Limited(300750) , leading the industrial chain to grow together. At the end of 2021, the company signed a memorandum of intent on joint venture investment with Contemporary Amperex Technology Co.Limited(300750) and both parties intend to set up a joint venture, of which Guangdong Jiayuan Technology Co.Ltd(688388) accounts for 80%, and build a high-performance electrolytic copper foil project with an annual output of 100000 tons. All products produced by the joint venture will give priority to Contemporary Amperex Technology Co.Limited(300750) supply. This joint venture plant reflects the continuous tight supply of the industry. According to the announcement, at the end of 2021, the company has a production capacity of 26000 tons. According to the construction plan of raised investment projects, the company is expected to achieve production capacity of 45000 tons, 83000 tons, 101000 tons and 107000 tons from 2022 to 2025 respectively. After this joint venture, the company’s capacity expansion will be greatly accelerated, and the planned total capacity will exceed 200000 tons. The total capacity and production speed are significantly ahead of the industry. With the production of new capacity in the future, the company’s performance will be realized steadily.
Profit forecast and investment suggestions. It is estimated that the company’s EPS from 2022 to 2024 will be 4.53 yuan, 8.26 yuan and 12.58 yuan respectively, and the net profit attributable to the parent company will maintain a compound growth rate of 75% in the next three years. Considering the company’s deep binding with downstream customers and strong performance certainty, the “buy” rating is maintained.
Risk tips: development risk of new products and technologies, loss risk of core technicians, fluctuation risk of lithium-ion battery industry caused by changes in new energy vehicle industry policies, risk of core technology gap of lithium battery copper foil, risk of single product structure and concentration of downstream application fields, risk of intensified market competition, risk of failure to launch new capacity on schedule.
