\u3000\u3 Guocheng Mining Co.Ltd(000688) 388 Guangdong Jiayuan Technology Co.Ltd(688388) )
Event: on March 25, Guangdong Jiayuan Technology Co.Ltd(688388) released its annual report for 2021, with a total operating revenue of 2.804 billion yuan, a year-on-year increase of 133.26%; The net profit attributable to the parent company was 550 million yuan, with a year-on-year increase of 195.02%; Deduct non net profit of 497 million yuan, with a year-on-year increase of 203.54%; Operating cash flow was 319 million yuan, with a year-on-year increase of 249.68%. Among them, the company’s Q4 revenue was 817 million yuan, a year-on-year increase of 97.66%; The net profit attributable to the parent company was 156 million yuan, a year-on-year increase of 122.76%; Deduct non net profit of 132 million yuan, with a year-on-year increase of 95.60%.
Comments: the gross profit margin of the company’s sales in 21 years was 30.03%, with a year-on-year increase of 5.79 percentage points, and the net profit margin was 19.63%, with a year-on-year increase of 4.12 percentage points; The gross profit margin of Q4 was 28.91%, down 0.24 percentage points month on month, and the net profit margin was 19.12%, down 0.07 percentage points month on month.
The sales volume of high-end products increased, and the selling price increased significantly. According to the data of the company’s annual report, the company’s copper foil sales volume in 21 years was 27800 tons, with a year-on-year increase of 73.7%; The corresponding selling price was 101000 yuan / ton, with a year-on-year increase of 34.3%; In 21 years, the sales volume of products within 6 microns of the company was 18400 tons, with a year-on-year increase of 139%; 9400 tons of products above 6 microns, a year-on-year increase of 13%; The products are obviously differentiated, and the sales volume of high-end products is increasing.
The processing fee increased by nearly 10000 yuan / ton. According to the data of the company’s annual report, we divide the company’s material cost by sales volume to calculate that the raw material cost of copper foil in 20-21 years is 43200 yuan / ton and 59400 yuan / ton respectively. Since the copper foil business is a cost plus processing fee pricing model, we deduct the raw material cost at the average sales price, which is 32000 yuan / ton in 20 years and 41500 yuan / ton in 21 years, with a year-on-year increase of 29.9% and 9600 yuan / ton, representing the increase of the company’s copper foil processing fee.
The processing cost decreased by 2600 yuan / ton. According to the data of the company’s annual report, we calculate the processing cost by dividing the labor cost, manufacturing expenses and freight and miscellaneous expenses by the sales volume. The processing cost of the company in 21 years was 11200 yuan, a decrease of 2600 yuan compared with 13800 yuan in 20 years. The labor cost decreased by 0500 yuan to 2200 yuan / ton, and the manufacturing cost decreased by 200000 yuan / ton;
The gross profit per ton increased by 12100 yuan / ton. The processing fee increased by 9600 yuan and the processing cost decreased by 2600 yuan, which corresponded to a significant increase in the company’s gross profit per ton and a significant increase in profits; In combination with the company’s selling price and gross profit margin, we calculated the company’s gross profit per ton of 30300 yuan in 21 years, with a year-on-year increase of 12100 yuan / ton.
At the current time point, we continue to be optimistic about the sustainability of the company’s lithium battery copper foil growth. We believe that the power battery of new energy vehicles will maintain a high growth from 22 to 23 years, and the demand for energy storage products will be booming, resulting in the continuous increase of the company’s demand for lithium battery copper foil.
Investment suggestion: due to the strong demand in the downstream new energy vehicle market and the rapid expansion of production of lithium-ion battery manufacturers, the company binds with the head battery enterprises and increases the amount of cooperation. The capacity utilization rate and production and marketing rate are full. Through the acquisition of Shandong Jiayuan and rapid expansion of production, it is expected to achieve sales growth beyond expectations. We estimate that the net profit attributable to the parent company in 2022 and 2023 will be 1.02 billion and 1.86 billion respectively (540 million and 740 million before adjustment), corresponding to PE 20.6x and 11.2x, which are rated as “overweight”.
Risk warning: the sales volume of new energy vehicles is lower than expected, the technical process changes, and the information and data used in the research report are not updated in time.
