\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 522 Jiangsu Zhongtian Technology Co.Ltd(600522) )
The leading enterprise of optical cable and cable, with continuous expansion of business layout. The company was founded in 1996 and started from optical fiber communication. At present, it has formed five business segments: optical communication, power transmission, ocean, new energy and new materials. The CAGR of the company’s operating income and net profit attributable to the parent company in 16-20 years were 20% / 9% respectively, of which the marine business benefited from the continued boom in the demand of downstream industries, and the CAGR of the company’s income in 16-20 years was nearly 60%.
The technology of submarine cable industry is leading, and the marine business is expected to continue to contribute to the performance. Under the expectation of parity, it is expected that the newly installed CAGR of sea breeze in 23-25 years is expected to reach 30%. Benefiting from the large-scale quantification and far-reaching trend of wind farm, the value of submarine cable link is expected to rise instead of falling. The company is one of the few enterprises in China with ultra-high voltage AC and DC submarine cable production capacity. The submarine cable production capacity of the company is expected to reach 7.5 billion yuan by the end of 22. With the addition of the company’s planned transformation and expansion of marine business, the marine business is expected to continue to grow with the continuous release of the company’s production capacity.
Photovoltaic + energy storage + copper foil multi-point layout, high growth of new energy business can be expected. Driven by the decline of photovoltaic lcoe and the goal of carbon neutralization, the demand of the industrial chain is expected to maintain a high boom. The company is expected to make full use of local resources in Rudong and drive the income growth of supports, fluorine films and other products through EPC. China’s electrochemical energy storage demand is expected to continue to grow, and the cumulative scale CAGR in 21-25 years is expected to reach 57%. The company has the layout of the whole industrial chain, and is expected to continue to make efforts in the field of large energy storage in the future.
The demand for wires and cables is stable, and optical fibers and cables are expected to see both volume and price rise. Wires and cables are widely used downstream, and the demand is expected to grow steadily. The technical strength of the company’s special conductor and high-voltage DC cable is leading in the industry and is expected to benefit from the promotion of the construction of new power system. The competition pattern of the optical fiber industry is concentrated. In the past 21 years, the company share and average price of mobile optical fiber centralized procurement have rebounded significantly, and the business is expected to usher in a simultaneous rise in volume and price in 22 years.
Investment suggestion: it is estimated that the net profit attributable to the parent company will be 142 / 3793 / 4721 million yuan respectively in 21-23 years, with a year-on-year increase of – 93.8% / + 2568.0% / + 24.5%. Using the segment valuation method, the target market value of the company in 2022 is 83.079 billion yuan, corresponding to the target stock price of 24.34 yuan. The company is given a “buy” rating for the first time.
Risk tips: macroeconomic risk, lower than expected sea breeze parity, lower than expected new photovoltaic installed capacity, lower than expected energy storage construction progress, and risk of raw material price fluctuation
