\u3000\u3 China Vanke Co.Ltd(000002) 430 Hangzhou Oxygen Plant Group Co.Ltd(002430) )
Event: March 29 Hangzhou Oxygen Plant Group Co.Ltd(002430) released the 2021 annual report. (1) In 2021, the operating revenue was RMB 11.878 billion, a year-on-year increase of 18.53%, and the net profit attributable to the parent company was RMB 1.194 billion, a year-on-year increase of 41.60%; The net cash flow of operating activities was RMB 3.45 billion, with a year-on-year increase of RMB 3.47 billion; The asset liability ratio was 51.05%, which was low. (2) In 2021q4, the operating revenue was 2.916 billion yuan, a year-on-year increase of 4.32%, and the net profit attributable to the parent company was 147 million yuan, a year-on-year decrease of 25.41%; The net cash flow from operating activities was 140 million yuan, a year-on-year decrease of 51.72%.
The operating performance of air separation equipment and gas increased, and the overall profitability improved steadily. In 2021, the company’s comprehensive gross profit margin was 24.64%, with a year-on-year increase of 1.96pct. In terms of business, the revenue of the gas industry was 6.616 billion yuan, a year-on-year increase of 22.05%, and the gross profit margin was 26.17%, a year-on-year increase of 3.9pct; The manufacturing revenue was 4.827 billion yuan, a year-on-year increase of 12.37%, and the gross profit margin was 23.29%, a year-on-year decrease of 0.21 PCT; The general contracting revenue of the project was 212 million yuan, with a year-on-year increase of 121.03%, and the gross profit margin was 12.22%, with a year-on-year increase of 3.21 PCT. The company’s gas industry has accelerated, the market recognition and comprehensive competitiveness have been further improved, and the team’s market development ability has become stronger and stronger. In 2021, the company signed new gas supply projects such as Yukun iron and steel, Yulong petrochemical and Hubei Jinkong. The new oxygen production scale of the gas investment project is about 640000 m3 / h, a record high over the years. The gas management system is becoming more and more perfect, and regional construction, gas retail logistics system construction and safety management system construction are promoted simultaneously. In 2021, Chengde Hangyang phase II 25000 m3 / h, Jinan Hangyang 40000 m3 / h and Jiangxi Hangyang 80000 m3 / h air separation projects were successively completed and put into operation. Qingdao Hangyang electronic gas project has completed phase I construction, and phase II high-purity nitrogen equipment is under construction. In terms of downstream application expansion, the company accelerated the certification of medical oxygen and food grade nitrogen, and accelerated the layout of krypton xenon business. The new refined krypton xenon project of Quzhou special gas is progressing smoothly.
Closely following the industrial policies, the number of new orders signed in the equipment market is considerable. Seizing the opportunity of refining the “double carbon” policy and recovering the demand of the downstream market, the company actively adjusted its strategy and maintained new and old customers. In the whole year, the company made a total of 6.24 billion yuan of new air separation equipment contracts and 600 million yuan of petrochemical equipment orders, maintaining an absolute leading position in the field of petrochemical equipment. In 2021, the company undertook the carbon monoxide cryogenic separation unit project of China’s first syngas to ethanol project.
Earnings forecast, valuation and rating. We predict that the company’s operating revenue in 22-24 years will be 14 / 159 / 17.95 billion yuan. Optimistic about the steady pace of expansion of the company’s gas operation business, the accelerated release of the profitability of the equipment business, and the continuous improvement of the profitability in the future, the forecast of the net profit attributable to the parent company in 22 years was raised to 1.5 billion yuan, which was + 4.92% compared with the last forecast. In the future, with the entry of high-quality competitors in the gas and air separation equipment market, the company’s operating costs may be under upward pressure, so the forecast of the net profit attributable to the parent company in 23 years was lowered to 1.7 billion yuan, which was – 1.06% compared with the last forecast, The 24-year net profit attributable to the parent company is predicted to be 1.9 billion yuan. The corresponding EPS of 22-24 years is 1.53/1.73/1.93 yuan respectively, and the corresponding PE is 19x / 17x / 15x, maintaining the “buy” rating.
Risk warning. The macroeconomic downturn brings the risk of lower downstream prosperity and lower gas consumption. Risk of large fluctuations in gas prices.
