\u3000\u3 Bohai Water Industry Co.Ltd(000605) 166 Hangzhou Juheshun New Material Co.Ltd(605166) )
Event: the company released the annual report of 2021, which achieved a revenue of 5.405 billion yuan (year-on-year + 110.77%) and a net profit attributable to the parent company of 239 million yuan (year-on-year + 106.19%). 2.051 yuan (including tax) for every 10 shares.
The volume and price rose together, and the company's performance increased significantly: the significant improvement of the company's performance was mainly due to the increase of product sales and price rise. According to Baichuan, the average price of PA6 in 2021 was 15200 yuan / ton, with a year-on-year increase of 34.1%. The price trend in 2021 showed a fluctuating upward trend, reaching the highest point of 17400 yuan / ton in October. According to the announcement, in 2021, the company's production capacity increased to more than 400000 tons compared with the end of the previous year. In order to alleviate the supply pressure, the company has commissioned external processing and purchased products. In 2021, the company produced 348000 tons of PA6 chips and sold 386000 tons, with a year-on-year increase of 46.74% and 53.30% respectively. In 2021, the company's comprehensive gross profit margin was 7.65%, a year-on-year decrease of 1.15 PCT, and the average price of raw material caprolactam was 13900 yuan / ton in 2021, a year-on-year increase of 39.7%. Since 2022, the prices of PA6 and caprolactam have been corrected compared with the high point in October 2021, but the price difference has expanded and the profitability is good.
China's PA6 industry is booming and has broad application space: benefiting from the progress of polymerization technology, the stable supply of raw material caprolactam and the strong demand in downstream application fields, the production and sales of nylon 6 chip products in China continue to grow, the dependence on imports continues to decrease, and the trend of replacing imports is obvious. According to Baichuan, China's PA6 production capacity was 5.696 million tons and output was 4.0783 million tons in 2021, an increase of 8.1% and 7.9% respectively over 2020; The apparent consumption was 4.0757 million tons, a year-on-year increase of 3.2%; It is expected that in 2022, there will be many plans for the production of PA6 chips in the market, and the large-scale process will be accelerated. According to the announcement, China's Nylon 6 chips occupy a dominant position in the application field of nylon fiber, while the field of engineering plastics and film accounts for only 30%, which is far lower than the level of 50% in developed countries. In the future, it is expected to bring broader space for PA6 application in the fields of automobile, electronics, wind power and so on. As an enterprise in the first echelon of PA6 production technology and product performance in China (according to the announcement), the company has significant cost advantages and is expected to develop continuously and rapidly.
The company's production capacity is expected to continue to improve, and the development of high-end and differentiated layout is expected: according to the announcement, the company's fund-raising project "expansion project of polyamide 6 materials with an annual output of 100000 tons" has designed three production lines. The first two production lines have been put into operation, and the third production line has been put into operation in the fourth quarter of 2021. Nylon 66 and Nylon 66 and nylon 6 copolymer products were successfully tested in the fourth quarter Hangzhou Juheshun New Material Co.Ltd(605166) Luhua construction phase I "polyamide 6 chip project with an annual output of 180000 tons", "new nylon material project with an annual output of 104000 tons prepared by Hangzhou Juheshun New Material Co.Ltd(605166) headquarters" and Shandong Hangzhou Juheshun New Material Co.Ltd(605166) phase I "new nylon material (nylon 66) project with an annual output of 100000 tons" are being prepared. The company's production capacity is expected to continue to increase in the next few years and form a larger scale advantage. According to the announcement, by the end of 2021, the company's projects under construction were 230 million yuan, a significant increase over 46 million yuan at the end of 2020. At the same time, the company will develop and produce new products in the field of special nylon (nylon 66, high-temperature nylon, etc.), so as to realize the diversified and high-end development of the company's products.
Investment suggestion: it is estimated that the net profit of the company from 2022 to 2024 will be 300 million yuan, 410 million yuan and 540 million yuan respectively, corresponding to 14, 10 and 8 times of PE, maintaining the Buy-A rating.
Risk warning: price fluctuation, production capacity construction progress is less than expected, etc
