\u3000\u3 Shengda Resources Co.Ltd(000603) 063 Shenzhen Hopewind Electric Co.Ltd(603063) )
Event: the company released its annual report for 2021, and achieved an operating revenue of 2.104 billion yuan in 2021, a year-on-year decrease of 10.03%, mainly due to the transfer of power station business; The net profit attributable to the parent company was 280 million yuan, a year-on-year increase of 4.97%; The net profit deducted from non parent company was 234 million yuan, a year-on-year decrease of 17.35%. Among them, the non recurring profit and loss is mainly the reversal of 35.07 million yuan of bad debt reserves in the early stage, which is related to the company’s relatively strict bad debt accrual policy in the early stage. To sum up, the company’s performance in 2021 exceeded our expectations.
The company’s sales of photovoltaic inverters have increased significantly, and the business performance of wind power converter is better than that of the industry. The new energy electronic control business showed an overall growth trend. In 2021, the relevant business realized an operating revenue of 1.731 billion yuan, a year-on-year increase of 6.74%; The gross profit margin decreased by 8.98pct to 32.72%, mainly due to the intensified competition in the business of wind power converter. Among them, the operating revenue of wind power converter was 1.41 billion yuan, a year-on-year decrease of 4%. It is mainly due to the overdraft of onshore wind power in 2020, and part of the demand in 2021. In 2021, China’s wind power installed capacity increased by 47.6gw, a year-on-year decrease of 34%. Photovoltaic inverter business achieved an operating revenue of 322 million yuan, a year-on-year increase of 109%, and the sales volume of photovoltaic inverter increased by 486% to 45544 units. The company’s sales growth of photovoltaic inverter is greater than that of revenue, which is mainly due to increasing the proportion of series inverter shipments.
Engineering transmission business, SVG and energy storage business maintain a high view. The power station system business has been transferred out of the table. The engineering transmission business achieved an operating revenue of 200 million yuan, with a year-on-year increase of 92.71%. The company’s frequency converter business has outstanding technical advantages and won the “first prize of 2021 Metallurgical Science and Technology Award”, the highest technology award in the metallurgical industry in 2021. Other businesses (SVG, energy storage, etc.) achieved an operating revenue of 129 million yuan, a year-on-year increase of 115%. Hewang SVG products are the first SVG manufacturer in China to have Suzhou Electrical Apparatus Science Academy Co.Ltd(300215) high and low voltage ride through test report in China. Energy storage products include PCs (AC / DC type, DC / DC type), PCS box transformer integrated machine, EMS, outdoor industrial and commercial energy storage system integrated machine, off grid controller and other equipment and related systems. Relying on the good application of wind power converter and photovoltaic inverter in various environments and power grids at home and abroad, SVG business and energy storage business are expected to achieve synergy and sustainable growth.
Profit forecast, valuation and rating: the company maintains a leading position in the wind power converter market. With the rise of offshore wind power, the competitive advantage is expected to be further highlighted. The business of photovoltaic inverter is accelerated and actively going to sea, with broad prospects in the future. At the same time, the company’s engineering transmission, SVG and energy storage businesses are in a high boom track, which is highly coordinated with the new energy electronic control business. Based on the strict bad debt provision policy in the early stage, the company reversed the bad debt provision of 35.07 million yuan in 2021. The customer structure of wind power converter business continues to be optimized. Maintain the company’s net profit forecast of 439 / 585 million yuan in 202223, increase the forecast net profit of 764 million yuan in 2024, and the current share price corresponds to 37 times of PE in 2022. Focusing on power conversion and control, the company is expected to build core competitiveness around new energy power generation and maintain the “buy” rating.
Risk warning: the installed capacity of wind power and photovoltaic is less than expected; Overseas market expansion is less than expected; The risk of declining profits due to increased competition.
