\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 884 Ningbo Shanshan Co.Ltd(600884) )
Event: the company released the performance forecast for the first quarter of 2022, and realized the net profit attributable to the shareholders of the listed company was 750 million yuan to 850 million yuan, with a year-on-year increase of 148% to 181%; The net profit deducted from non profits was 560 million yuan to 600 million yuan, with a year-on-year increase of 99% to 113%.
Comments:
Lithium battery and polarizer account for half of the performance respectively, and the double leading layout has achieved remarkable results. According to our calculation, in Q1 performance of the company, polarizer business contributed Shenzhen Jt Automation Equipment Co.Ltd(300400) million and lithium battery business contributed Shenzhen Jt Automation Equipment Co.Ltd(300400) million. In the lithium battery business, the negative electrode business contributed 160180 million, and other lithium battery materials contributed about 200 million. The investment income is about 100150 million yuan from the sale of Yongshan lithium industry. The lithium battery business segments have achieved rapid growth, the lithium battery material aircraft carrier has set sail again, and the polarizer business has grown steadily.
The high-end anode materials resist the rising cost, and the profitability is expected to improve after the graphitization capacity is put into operation. With leading technology and high-quality products, the company’s market share continues to increase, and the products are in short supply at present. At the same time, due to the recent rise in oil prices, it is expected to drive the rise of negative raw materials by about 40%. Combined with the tight supply of negative graphitization and the sharp increase in costs in the first quarter, the company has achieved the stability of profitability by relying on the premium and cost control of high-end products. With the company’s Baotou project put into operation in the second quarter, the self supply rate of graphitization will be significantly improved, and it is expected to increase both volume and price. In the long run, the acceleration of Sichuan integration project is expected to ensure the continuous improvement of the company’s graphitization self supply rate and the continuous high growth of future shipments. After the cathode business was introduced into BASF, a global chemical material giant, it actively expanded its overseas business. The power business progressed smoothly and its profitability was significantly improved.
The polarizer business shows strong stability, and the value is expected to be revalued. The company’s profit of polarizer increased steadily and contributed a huge increment in Q1. In the past six months, when the downstream demand of polarizer has dropped, there has been no large profit fluctuation, reflecting the high bargaining power of the leader. The company plans to add two production lines in Mianyang. With the gradual production of the new production line, the share of polarizer is expected to further increase. With the change of scale effect and tax rate, the profit will rise steadily in the future. We expect that with the continuous enrichment of the company’s products, the valuation level is expected to continue to improve.
Profit forecast and investment rating: we expect the company’s revenue from 2021 to 2023 to be RMB 20.464 billion, 20.358 billion and 27.141 billion respectively, with a year-on-year increase of 149.1%, – 0.5% and 33.3%; The net profit attributable to the parent company was 3.283 billion yuan, 3.464 billion yuan and 4.549 billion yuan respectively, with a year-on-year increase of 2278.7%, 5.5% and 31.3%. The increase in profit forecast is based on the investment income from the sale of Yongshan lithium. The current share price corresponds to 17.5, 16.5 and 12.6 times of PE from 2021 to 2023 respectively, maintaining the “buy” rating.
Risk factors: industry demand is less than expected risk; Price fluctuation risk of raw materials; Risks of new technology development.
