\u3000\u30 Jinzai Food Group Co.Ltd(003000) 37 Shenzhen Capchem Technology.Ltd(300037) )
Matters:
The company issued the annual report of 2021. In 2021, the operating revenue was 6.951 billion yuan, a year-on-year increase of 134.76%; The net profit attributable to the parent company was 1.307 billion yuan, a year-on-year increase of 152.36%; The net profit deducted from non parent company was 1.233 billion yuan, with a year-on-year increase of 156.17%. It is proposed to distribute a cash dividend of 6.8 yuan (including tax) for every 10 shares, and the capital reserve will be converted into 8 shares for every 10 shares. The company expects to realize a net profit attributable to the parent company of 482513 million yuan in the first quarter of 21, with a year-on-year increase of 210% – 230%.
Ping An View:
The performance showed explosive growth, and all business segments were in full swing: in 21 years, the company’s revenue was 6.951 billion yuan, a year-on-year increase of 134.76%, and the revenue of electrolyte / organic fluorine / capacitor / semiconductor chemicals was 52.7/6.93/7.12/214 million yuan, a year-on-year increase of 218% / 23% / 32% / 36%. All business segments achieved comprehensive growth, and the proportion of electrolyte revenue increased to 76%. The net profit attributable to the parent company was 1.307 billion yuan, with a year-on-year increase of 152.36%. If the equity incentive fee and asset impairment are considered, the actual profit in 21 years is nearly 1.5 billion yuan, with a year-on-year increase of more than 180%. In the 21st year, the company’s comprehensive gross profit margin was 35.5%, a slight decrease of 0.5pct year-on-year; The net profit margin attributable to the parent company was 18.8%, with a year-on-year increase of 1.3pct, and the profit margin continued to improve; During the period, the expense rate decreased significantly year-on-year, including the management expense rate of 5.87%, a year-on-year decrease of 0.94pct. In a single quarter, the company’s revenue in 4q21 was 2.482 billion yuan, a year-on-year increase of 160%, a month on month increase of 30%, a comprehensive gross profit margin of 35.6%, and a month on month decrease of 1.8pct compared with Q3; The net interest rate was 18.5%, a decrease of 4.9pct month on month, mainly due to the impairment of about 33 million yuan. The performance of the first quarter of 22 years continued a high growth trend, and the net profit attributable to the parent increased by 10% – 17% month on month, significantly exceeding the market expectation.
The volume and price of electrolyte increased simultaneously, and raw materials continued to be overweight: in 21 years, the company’s battery chemicals business revenue was 5.27 billion yuan, a year-on-year increase of more than 2 times, the sales volume was 92000 tons, a year-on-year increase of 141%, and the average product price was 57200 yuan, a year-on-year increase of 32%; Among them, the revenue in the second half of the year was 3.5 billion yuan, an increase of 98% over 1h21.
The gross profit margin of electrolyte business in the whole year was 31.63%, with a year-on-year increase of 5.87pct; In the first half of the year, the gross profit margin was 27.4%. In the second half of the year, the gross profit margin increased to 33.8% due to the increase of the load rate of solvent projects and the follow-up increase of the prices of electrolyte and additives. The subsidiary hankang chemical had a revenue of 566 million yuan in 21 years, with a year-on-year increase of 130%; The net profit was 224 million yuan, a year-on-year increase of 511%, and the net interest rate was close to 40%, mainly due to the sharp rise in the prices of VC and FEC. We expect that the net profit per ton of electrolyte of the company will be about 11000 yuan and contribute about 1 billion yuan in 21 years. In terms of electrolyte capacity construction, at the end of the year, the design capacity of battery chemicals of the company reached 130000 tons, and the capacity under construction was 120000 tons, mainly including Poland, Tianjin and Sanming haisifu projects, which are expected to be put into operation in succession in 22-23 years; In terms of new lithium salts, Hengyang Fubang lifsi phase I project was put into operation at the end of 21, and is expected to contribute to the sales volume of 1000 tons in 22 years; In terms of solvents, the company plans to invest 195 million yuan to implement Huizhou phase 3.5 solvent expansion project, add 100000 tons of carbonate solvents to jointly produce 50000 tons of ethylene glycol, with a construction period of 1.5 years. It is expected to be put into operation in 2023, when it will have a production capacity of 154000 tons of solvents + 71000 tons of ethylene glycol. In terms of raw materials, the company has established the layout strategy of additives + solvents to continuously optimize the cost under the condition of improving the technical level of products.
Fluorine chemical + capacitor grew steadily, and semiconductor profits continued to improve: in 21 years, the company’s fluorine chemical business revenue was 693 million yuan, a year-on-year increase of 23.4%, the sales volume was 24000 tons, and the average price was 285000 yuan / ton. The revenue growth was mainly due to the increase of the average price. The gross profit margin of fluorination industry in the whole year was 64%, with a year-on-year decrease of 2.9pct, mainly due to the sharp rise in the price of raw materials and the change of product structure. The company seizes the opportunity of increasing market demand for fluorine-containing high-end fine chemicals and accelerating localization substitution. At the same time, the market demand for fluororubber vulcanizing agent, fluoropolymer modified comonomer, fluorosurfactant and other products is strong. The business of organic fluorine chemicals has maintained a good growth trend and is expected to contribute about 300 million profits in the whole year. The revenue of capacitor chemicals was 712 million yuan, with a year-on-year increase of 32.5%, mainly due to the recovery of capacitor market demand and the increase of the company’s market share, with a gross profit margin of 38.5%, which was basically the same year-on-year. It is expected to contribute about 150 million yuan in net profit in 21 years and will continue to maintain stable growth in 22 years. The revenue of semiconductor chemicals was 214 million yuan, with a year-on-year increase of 36%, and the gross profit margin was 28.7%, with a year-on-year increase of 4.75pct. High generation line copper etching solution increased steadily. Ultra high purity ammonia water made a breakthrough in the development of leading customers in the IC industry, achieved stable delivery, and is expected to contribute a net profit of 20-30 million yuan for the whole year.
Investment suggestion: as the leader of China’s high-end electrolyte and the leader of high-end fluorochemical industry, the company’s performance has shown explosive growth under the background of strong demand for new energy vehicles and rising prices of bulk raw materials in 21 years. In terms of electrolyte, the company will directly benefit from the large demand for global power batteries. At the same time, the production expansion of solvent and new lithium salt projects will improve the profit space; In terms of fluorine chemical industry, category expansion and customer expansion are the driving force for future revenue growth. At the same time, high technical barriers and good competition pattern will ensure to maintain high profitability. We maintained the company’s forecast of net profit attributable to parent company for 22-23 years of RMB 1.959/2.496 billion unchanged, and increased the forecast of net profit attributable to parent company for 24 years of RMB 3.014 billion, corresponding to the closing price of PE on March 29, which was 17.4/13.6/11.3 times respectively, maintaining the “recommended” rating.
Risk tips: 1) the risk of continuous impact of the epidemic. If the global epidemic repeats, it will have a negative impact on the downstream demand of the company; 2) Fierce competition leads to the risk of higher than expected price decline. Many projects in the industry have been put into operation, leading to price war, which may lead to the decline of the company’s profits; 3) The risk that the customer expansion is less than expected. The company has several projects under construction. If the customer expansion progress is less than expected, the company’s production capacity will be affected; 4) The risk of rapid changes in technology routes. If the development speed of emerging battery technologies such as solid-state batteries exceeds expectations, it will affect the company’s industry position and early investment recovery.
