\u3000\u3 Guocheng Mining Co.Ltd(000688) 087 Shandong Intco Recycling Resources Co.Ltd(688087) )
Yingke issued the first draft of stock incentive plan. On March 28, the company issued the 2022 restricted stock incentive plan (Draft), which is the first equity incentive plan after the company’s listing. It plans to grant 1.598 million restricted shares to the incentive objects, accounting for about 1.2% of the company’s total share capital of 133032 million shares on the announcement date. The total number of incentive objects is 427. The grant price of restricted shares in this incentive plan is 28.9 yuan / share, and the pricing principle matches the performance requirements, The restricted shares granted by this incentive plan will be restricted for 12 months, 24 months, 36 months and 48 months respectively from the date of completion of the registration of restricted shares, and 25% of the restricted shares will be lifted every 12 months.
Stimulate the motivation of core employees and show their confidence in development. The incentive plan sets reasonable performance assessment targets. The corresponding assessment year is four fiscal years from 2022 to 2025. Based on the net profit in 2021, the annual net profit growth rate is assessed. It is required that the net profit growth rate in 20222025 relative to 2021 shall not be less than 15%, 32%, 59% and 90%. The proportion of sales restrictions lifted shall be calculated according to the index completion, the interests of employees and shareholders shall be deeply bound, and the core employees shall be promoted to give full play to their subjective initiative and creativity, It will have a positive impact on the company’s sustainable operation ability and shareholders’ equity.
The layout of the whole industrial chain is scarce, expand renewable PET and improve performance flexibility. The company has the only complete industrial chain of PS plastic recycling in the industry, with steady growth in historical performance. In the future, the company will horizontally expand pet, PE, PP, HDPE and other recycled plastic products, establish a diversified product system and improve performance flexibility. At present, the 50000 T / a PET recycling project in Malaysia is under commissioning, and the high-quality regeneration project of 100000 t / a multi category plastic bottles in Anhui is under preparation. In addition, the production of PS and pet will be expanded to the target capacity of 300000 t / a (about 97000 T / A at present) and 1 million T / a (50000 T / a new capacity is under commissioning), and the future capacity release will continue to increase the company’s profits.
The advantages of channel, technology and scale create a high moat. The production of the company has scale effect, the core self-developed technology builds barriers, the recycling network covers more than 50 countries, and has more than 400 recycling points. The overseas recycling cost advantage is obvious (the average price difference of plastics purchased at home and abroad is in the range of 10102610 yuan / ton, and the cost advantage is about 20% – 40%), and the price advantage of recycled plastics is about 40% compared with that of primary plastics.
Investment advice. As the leader in the field of plastic recycling, the company has the advantages of scale, technology and channel, and benefits from the policy dividends of various countries. The industry has a large space. In the past two years, the company’s production capacity has been released intensively and entered an accelerated growth period. Under the background of strong promotion of double carbon and recycling, recycled plastics have the characteristics of reducing carbon by 30 ~ 64% compared with primary plastics, and its future development is worth looking forward to. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 240 / 3.3 / 460 million yuan and EPS will be 1.79/2.49/3.42 yuan respectively. The corresponding PE is 34.5x / 24.8x / 18.0x respectively, maintaining the “buy” rating.
Risk warning: the risk of market growth slowdown caused by policy changes; Risk of raw material supply and product sales of new projects; Foreign trade, tariff policy and exchange rate fluctuation risk.
