\u3000\u3 Shengda Resources Co.Ltd(000603) 678 Fujian Torch Electron Technology Co.Ltd(603678) )
Event: the company released its annual report for 2021, and achieved a revenue of 4.734 billion yuan, a year-on-year increase of 29.48%; The net profit attributable to the parent company was 956 million yuan, a year-on-year increase of 56.83%.
The apparent performance was affected by many aspects, and the profit margin reached a record high
In 2021, the company achieved a revenue of 4.734 billion yuan, a year-on-year increase of 29.48%; The net profit attributable to the parent company was 956 million yuan, a year-on-year increase of 56.83%. We judge that the main reason why the annual performance is slightly lower than the lower limit of the previous performance forecast is that the company has 15.86 million yuan of donations, 11.58 million yuan of share based payment expenses and 38.69 million yuan of deferred income from government subsidies. During the period, the company’s expense rate was 9.95%, slightly lower than the same period last year, of which the R & D expense was 108 million yuan, with a year-on-year increase of 58.12%. The R & D expense rate increased significantly, indicating that the company’s R & D innovation layout investment is increasing. In terms of profit margin, the gross profit margin was 35.52%, with a year-on-year increase of 3.67pct; Roe was 22.41%, with a year-on-year increase of 4.57pct, and the profit margin reached a record high. At the end of the balance sheet, the inventory was 1.129 billion yuan, with a year-on-year increase of 18.56%, including products in process + 43.75% and goods in stock + 36%, indicating sufficient orders on hand and full production scheduling. At the end of the cash flow statement, the net cash flow from operating activities was 594 million yuan, a year-on-year increase of 2237%, and the collection increased significantly.
The proportion of military products business continues to increase, and new categories continue to grow rapidly
The oligopoly pattern of military MLCC market is obvious. The leading suppliers include Fujian Torch Electron Technology Co.Ltd(603678) , Beijing Yuanliu Hongyuan Electronic Technology Co.Ltd(603267) , Chengdu Hongming, and the company’s main customers are aviation, electronics, aerospace and weapons. In the 21st year, the self-produced components business achieved a revenue of 1.523 billion yuan, a year-on-year increase of 43%; The gross profit margin was 78.02%, with a year-on-year increase of 7.49pct. We judged that the reason was the increase in the proportion of military products with high gross profit margin. In addition, Guangzhou Tianji achieved a revenue of 174 million yuan, a year-on-year increase of 37.5%; The net profit was 58.19 million yuan, with a year-on-year increase of 45%. SLCC continued to accelerate the pace of domestic substitution. We believe that with the continuous improvement of informatization and intelligence of weapons and equipment, the military products business in self-produced business will still grow rapidly.
The performance contribution of ceramic materials continues to break through and is expected to become a new growth point in the future
In 2021, the company’s ceramic materials achieved a revenue of 66.21 million yuan, a year-on-year increase of 34.8%; The gross profit margin was 74.44%, with a year-on-year increase of 3.91pct. From the perspective of subsidiaries, Liya new material achieved a revenue of 122 million yuan, a year-on-year increase of 15.12%; The net profit was 41.05 million yuan, a year-on-year increase of 26.54%. Liya chemical achieved a revenue of 51.07 million yuan, a year-on-year increase of 136.44%; The net profit of 4.7 million yuan turned losses into profits, further improving the independent guarantee ability of industrialization. In the future, with the finalization and batch production of downstream complete machine models, the new material business is expected to gradually contribute to the performance.
The trade sector actively expands new product lines and emerging markets, and sustainable and stable development can be expected
The products covered by the trade sector mainly include high-capacity ceramic capacitors, tantalum electrolytic capacitors, metal film capacitors, aluminum electrolytic capacitors, inductors, duplexers, filters, etc. the downstream is mainly concentrated in the fields of communication products, digital products, automotive electronics, security, industrial electronics, etc. In the whole year of 21, the trading sector achieved a revenue of 3.062 billion yuan, with a year-on-year increase of 23.86%. The company highlights the differentiated competitive advantage through all-round services such as training, testing and technical support, and may develop continuously and stably in the future.
Profit forecast and rating: during the “14th five year plan” period, the demand for downstream military capacitors is significantly large. With the finalization and batch production of complete machine products, the business of special ceramic materials is expected to enter the stage of rapid large-scale production. We believe that the long-term development of the company can be expected. Since the performance in 21 years was slightly lower than the previous forecast value, we reduced the revenue in 22-23 years from 68.46/89.57 to 5.861/7.086 billion yuan and 8.541 billion yuan in 24 years; The net profit attributable to the parent company decreased from 1.405/1.822 billion yuan to 1.252/1.606 billion yuan, 24 years to 2.054 billion yuan, corresponding to EPS of 2.72/3.49/4.47 yuan / share, corresponding to pe1.9 billion yuan 26 / 15.02/11.74x, maintain the “buy” rating. Risk warning: the risk of price reduction of military products; The market demand of military products is less than expected; The industrialization of ceramic materials is less than expected.
