Core view
The tight supply and demand pattern of coal continued to improve, and coal prices continued to operate at a high level. At present, the national development and Reform Commission has strengthened the implementation of coal supply and price stability and the coal contract of the China long term association to reduce the sharp fluctuation of coal price and ensure the safety and stability of energy supply. On the supply side, we expect that the daily energy output will continue to approach the high daily energy level of 12.6 million tons last year in the short term. Affected by last year's supply and price stability, the marginal elasticity has been released relatively much, and the possibility of significant improvement of the short-term margin is small, At present, the tense situation is difficult to form and improve significantly. With the superposition of factors such as the impact of China's epidemic on transportation capacity and the rise of highway freight, the supply side is still the core reason. The main coal producing countries in Indonesia and Australia have negative factors for the reduction of coal supply. The high overseas coal price leads to the decline of China's import demand in March. Due to the influence of transportation capacity and full supply guarantee of power plants, the port inventory level cannot be recovered quickly in the short term. The inventory is at the low level in the same period of the last three years, and the daily consumption level of downstream power plants is increasing, resulting in the shortage of coal in the market, while building materials Chemical industry is less sensitive to coal prices, and we expect coal prices to remain high and continue to operate.
The improvement of coking coal supply-demand relationship is expected to be weak, and the price rebound is expected to continue. In terms of coking coal, we believe that the current logic of price rise is relatively certain. China's coking coal has insufficient new production capacity since 2020, with an annual gap of more than 70 million tons. The main import sources are Outer Mongolia and Russia. Since Australia's coal import was stopped in November 2020, the supply of coking coal has always been weak, which has been greatly disturbed by the supply. Although the customs clearance in Outer Mongolia has recovered recently, it is expected to stabilize at the daily customs clearance of about 200 vehicles, It is still far below the average level of about 800 vehicles in 2019 and 2020. The import of foreign Mongolia is blocked, which intensifies the tension between supply and demand in China. In addition, there are many coal mining safety accidents in Guizhou, Yunnan and other places recently, and the safety and environmental protection inspection is expected to be further strengthened in the future, which may aggravate the tight supply pattern of coking coal. It is suggested to focus on listed companies related to coking coal.
China Coal Energy Company Limited(601898) , China Shenhua Energy Company Limited(601088) released the performance report of 2021. With high profits and high dividends, it is optimistic about the investment value of the industry China Coal Energy Company Limited(601898) in 2021, the operating revenue reached 231127 billion yuan, with a year-on-year increase of 64%; The net profit attributable to the parent company was 13.282 billion yuan, a year-on-year increase of 124.8%. The net profit attributable to the shareholders of the listed company after deducting non recurring profits and losses was 13.076 billion yuan, a year-on-year increase of 127.50%, a new high since the listing. The basic earnings per share was 1.00 yuan and the dividend per share was 0.301 yuan (including tax). Calculated by the closing share price of 7.64 yuan on March 25, the dividend rate was 3.9% China Shenhua Energy Company Limited(601088) in 2021, the operating revenue reached 335216 billion yuan, with a year-on-year increase of 43.7%; The net profit attributable to the parent company was 50.269 billion yuan, a year-on-year increase of 28.34%, the basic earnings per share was 2.53 yuan, and the operating net cash flow was 94.575 billion yuan, a year-on-year increase of 16.3%. RMB 25.4 per 10 shares, calculated according to the closing price on March 25, with a dividend rate of 9.35% China Coal Energy Company Limited(601898) and China Shenhua Energy Company Limited(601088) as the leaders of China's coal enterprises, the high profit growth rate and high score red highlight the investment value of the coal industry. The overall supply and demand pattern of the coal industry is tight, the central price of coal rises, the future supply elasticity remains certain constraints, and they are optimistic about the steady improvement of medium and long-term industry profits and valuation repair.
Risk tip: downside risk of economic growth, mismatch risk of supply and demand, impact of extreme weather and coal policy are not as expected.
