\u3000\u30003 China Zhenhua (Group) Science & Technology Co.Ltd(000733) 00073)
The company released the annual report of 2021, and the profit increased significantly by 183% year-on-year. The positive material volume of the company increased rapidly, and the high nickel material volume increased rapidly, maintaining the overweight rating.
Key points supporting rating
The company’s profit in 2021 increased significantly year-on-year, which was in line with expectations: the company released its annual report in 2021 and achieved an operating revenue of 8.258 billion yuan, a year-on-year increase of 159.41%; The profit was 1.091 billion yuan, a year-on-year increase of 183.45%; Deduct non-profit 824 million yuan, a year-on-year increase of 238.28%. According to the calculation, the profit of 2021q4 was 364 million yuan, an increase of 202.16% year-on-year and 29.62% month on month; Deduct 310 million yuan of non-profit, an increase of 176180% year-on-year and 38.89% month on month. The performance of the company’s annual report is in line with expectations.
The operating cash flow was significantly improved: the net cash flow generated by the company’s operation in 2021 was 761 million yuan, a year-on-year increase of 15.19%. Among them, the net cash flow of 2021q4 was 347 million yuan, a year-on-year increase of 105.79%.
The amount of cathode materials increased rapidly, and high nickel products increased rapidly: the company established a solid cooperative relationship with skon, LG Chemical, AESC and other enterprises. The annual sales volume of cathode materials was 47000 tons, with a year-on-year increase of 97%. The product sales volume reached a record high, with an operating revenue of 8.066 billion yuan, a year-on-year increase of 167.66%, and the average settlement price was 172 thousand yuan / ton, with a year-on-year increase of 95.8%; The gross profit margin was 17.68%, with a year-on-year increase of 0.08 percentage points; The net profit per ton is expected to be about 17000 yuan. The company’s high-pressure, solid and long-life agglomerated high nickel products are rapidly sold to international high-end customers. Ni95 products have completed international customer certification, and the export proportion of products has reached 33.4%.
Accelerate the layout of lithium iron phosphate, solid-state battery and other technologies: the company accelerated the product development and market layout of lithium iron phosphate business, and successfully completed the finalization of lithium iron phosphate process. The company has completed the product development of solid-state lithium battery products and realized the market-oriented application and batch supply of solid-state lithium battery products.
From January to February 2022, the performance was bright, and the proportion of high nickel gradually increased: the company released the announcement of main business data from January to February 2022, and the operating revenue from January to February was about 2.348 billion yuan, a year-on-year increase of about 202.21%; The net profit attributable to the parent company was about 230 million yuan, with a year-on-year increase of about 113.91%.
Valuation
Under the current share capital, combined with the company’s announcement and industry conditions, we adjusted the company’s predicted earnings per share from 2022 to 2024 to 3.16/4.37/5.54 yuan (the original predicted diluted earnings per share from 2022 to 2023 was 2.92/3.72 yuan), corresponding to a P / E ratio of 23.9/17.3/13.6 times; Maintain the overweight rating.
Main risks of rating
The price of raw materials fluctuated disadvantageously, the industrial policy of new energy vehicles did not meet expectations, the product power of new energy vehicles did not meet expectations, the demand of the industrial chain did not meet expectations, and the impact of the epidemic exceeded expectations
