\u3000\u3 Guocheng Mining Co.Ltd(000688) 187 Zhuzhou Crrc Times Electric Co.Ltd(688187) )
Event overview:
The company released its 2021 annual report: the revenue was 15.1 billion yuan, a year-on-year increase of – 5.7%, the net profit attributable to the parent was 2 billion yuan, a year-on-year increase of – 18%, and the net profit not attributable to the parent was 1.5 billion yuan, a year-on-year increase of – 19%. The three indicators met the previous performance express guidelines. It is estimated that the company achieved a revenue of 6.6 billion yuan in 21q4, with a month on month ratio of + 104% and a year-on-year ratio of + 7%. The net profit attributable to the parent company in this quarter was 820 million yuan, with a month on month ratio of + 60% and a year-on-year ratio of – 16.6%. The corresponding deduction of non attributable net profit was 650 million yuan, with a month on month ratio of + 67% and a year-on-year ratio of – 10%.
Power & new energy and other emerging businesses have effectively hedged the impact of the decline in rail transit business
The year-on-year decrease in revenue in 2021 was mainly due to the significant reduction of new investment in mobile equipment by guotie group due to the impact of the epidemic, which dragged down the rail transit business, which accounted for the largest proportion of the company’s revenue. The revenue of rail transit business in that year was 12.25 billion yuan, a year-on-year decrease of 11.8%. The change of product sales structure also reduced the overall gross profit margin by 3.48 PCT. However, with the steady and rapid growth of emerging businesses such as power semiconductor and electric drive of new energy vehicles, the company effectively hedged the adverse impact on the rail transit sector. From the quarter on quarter perspective, the revenue and profit of 21q4 have rebounded significantly, showing the recovery momentum of rail transit business with a high proportion. Looking forward to 2022, with the further mitigation of the epidemic, China’s railway freight and passenger transport demand recovers, and the equipment investment of China Railway Group is expected to pick up, driving the rebound of the company’s rail transit business; In emerging industries, the company’s phase II 8-inch production line is close to reaching production after 21 years of construction, which is expected to provide strong capacity support for the rapid development of the company’s power semiconductor new energy vehicle electric drive business.
There are still new breakthroughs in rail transit business and considerable progress has been made in emerging industries
In the face of the decline in the investment in new manufacturing of national railway mobile equipment, the company strives to ensure the delivery of orders; The Urban Rail business deepened “urban operation”, and the new signing of non traction products reached a record high; In addition, the order breakthrough from zero to one has been achieved in the condition based maintenance of metro traction system, overseas signal system business and public works multi-functional mechanical operation vehicle. In terms of emerging industries, Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) achieved an annual revenue of 2.57 billion yuan, an increase of 35% year-on-year The revenue of power semiconductor was 1.068 billion yuan, an increase of 33% year-on-year. IGBT was delivered in batches in the field of rail transit and power grid, ranking first in China; The annual sales volume of electric drives for passenger cars entered the top ten in the industry, with 85000 sets delivered and a revenue of 456 million yuan, an increase of 171% year-on-year; Mine card electric drive, wind power converter, etc. shall be delivered in batches continuously.
Seize the opportunity of “double carbon” and actively expand production to ensure high growth in the future
Under the background of “double carbon”, the company’s strategy is to unite ecological partners to build an end-to-end technology ecosystem with the deep integration of wind, light, storage, hydrogen and electric control technology. 1) New energy power generation: in 2021, the company actively expanded new energy equipment such as photovoltaic inverter and wind power converter, and the number of devices delivered in the field of new energy power generation increased significantly throughout the year. 2) New energy vehicles: more than 85000 sets of electric drive systems of new energy vehicles were delivered in the whole year of the 21st century, which has ranked among the top 10 in the industry, and the scale of automobile sensor chips ranks in the forefront of the industry. In addition, the company has established joint ventures with Dongfeng and GAC to further deepen the ecological collaborative layout. 3) Silicon carbide: the 3300v silicon carbide traction converter of the company has been applied in Shenzhen Metro, and the energy consumption has been reduced by 10%. It is expected to continue the development path of IGBT devices from high-voltage rail transit to medium and low-voltage automobile in the future. The company actively expanded production and gave full play to the advantages of IDM: the company’s IGBT chip phase II production line was officially put into operation at the end of 21, further improved the production capacity layout of 6-inch bipolar devices, 8-inch IGBT and 6-inch silicon carbide, and mastered the whole line of chips, modules, components and application technology, which is expected to strongly support the development of the company’s new energy business in 22 years.
Investment advice
In view of the fact that the rail transit business of the company is deeply affected by the national railway bidding, we adjusted our forecast of the company’s net profit attributable to the parent company in 2022 / 22 / 24 to 2.36/30.6/3.58 billion yuan (previously estimated that the net profit attributable to the parent company in 22-23 years was 2.89/3.49 billion yuan), and the corresponding PE is 35 / 27 / 23 times. Referring to the current 96 times PE (TTM) of Shenwan semi conductor, considering that the company, as one of the leading enterprises of IGBT in China, has leading technical strength in China and accelerated domestic substitution, Maintain the “buy” rating.
Risk tips
The industry boom is less than expected, the progress of R & D is less than expected, and the ramp up of production capacity is less than expected.
