\u3000\u3 Shengda Resources Co.Ltd(000603) 997 Ningbo Jifeng Auto Parts Co.Ltd(603997) )
Event: on March 31, the company released its annual report for 2021. The company achieved an operating revenue of 16.832 billion (+ 6.99%) and a net profit attributable to the parent company of 126 million, reversing losses and a gross profit margin of 14.14%.
Revenue continued to grow in 2021, and some factors disturbed profits in the short term. The company achieved a quarter on quarter operating loss of 3.57 billion yuan, with a year-on-year growth of 3.7 billion yuan, of which the company achieved a year-on-year loss of 3.5 billion yuan, with a year-on-year revenue of about 3.7 billion yuan. The main reasons for the decline of Q4 revenue and the pressure on Profitability: 1) the continuous shortage of automotive chips worldwide; 2) Rising prices of raw materials; 3) Rising international shipping costs; 4) The overseas epidemic continues to affect. On the whole, in 2021, although the company was affected by various disturbance factors and short-term profitability, it still achieved profitability throughout the year.
The integration strategy has achieved initial results, and the profit will continue to improve in 2022. In 2021, various integration measures were continuously promoted, and the integration strategy achieved initial results: the effective implementation of grammer’s structural cost reduction and efficiency enhancement measures turned the group from loss to profit under the circumstances of rising raw material prices, chip shortages, rising freight rates and repeated epidemics. The profitability, capital structure and operating capacity of the group were significantly optimized. At the same time, passenger car seats, hidden electric vents New businesses such as heavy truck smart home cockpit have also been successfully developed and introduced to the market. We believe that Q4 in 2021 is the bottom of the company’s profit. In 2022, with the partial conduction of the cost side pressure caused by raw materials and freight, the gradual easing of the shortage of chip supply and the launch of new businesses, the company’s profitability is expected to continue to improve.
Gradually expand the production capacity and actively layout the production capacity of passenger car seats. Commercial vehicle production capacity: in May 2021, grammer and FAW established a joint venture subsidiary to support various series of commercial vehicles and trucks of Faw Jiefang Group Co.Ltd(000800) company, which was officially put into operation in October 2021. Traditional business capacity: grammer has built a new production base in Shenyang to produce high-quality center console, armrest and other interior parts for BMW, which has been officially put into operation in August 2021. Passenger car seat production capacity: according to the company’s annual report, the company has set up a new production base for passenger car seats and other products in Hefei, which is expected to be completed in 2022. Mass production can be realized in the first half of 2023, and various preparations for expanding seat production capacity outside Hefei base are made.
Breakthroughs have been made in new business and smooth customer expansion. 1) Passenger car seats: according to the order announcement disclosed by the company, combined with grammer’s technology and technical endowment, the company successfully entered the field of passenger car seats, and obtained the seat order of a new power main engine factory in October 2021, realizing the breakthrough of passenger car seat business from 0 to 1, and the single vehicle value of the company’s products has been greatly improved. According to the information of the company’s annual report, the company aims to obtain the access qualification of the new main engine plant in 2022 and successively obtain the designated points of new projects. 2) Concealed electric air outlet: it is a new product born under the trend of electrification and intelligence. It can realize the integration of touch control, voice control, automatic air sweeping and instrument panel. At present, it has been designated by Volkswagen, Geely, Great Wall Motor Company Limited(601633) , Weilai and other customers. It will take the lead in mass production at the end of 2021 and is expected to accelerate growth in 2022. 3) Heavy truck smart home cockpit: the company closely follows the trend of heavy truck home furnishing and takes advantage of grammer’s global leading advantage in the field of commercial vehicle cockpit. The company has started the commercial vehicle cockpit project since the second half of 2020 and actively developed heavy truck smart home cockpit with high single vehicle value. At present, customers have successively carried out sample vehicle trial installation. According to the information of the company’s annual report, the company aims to further improve the design and R & D on the basis of the trial assembly of the existing sample vehicles and according to the customer’s needs and road test results, and the customer expansion is in progress.
Investment suggestion: it is estimated that the company’s revenue from 2022 to 2024 will be 18.18 billion yuan, 20.36 billion yuan and 23.21 billion yuan respectively, and its net profit will be 399 million yuan, 639 million yuan and 875 million yuan respectively. Corresponding to the current market value, PE will be 25.6, 16.0 and 11.7 times respectively. It will be covered for the first time and given a “Buy-A” rating, with a six-month target price of 12.50 yuan / share.
Risk warning: the risk of car sales falling short of expectations, the risk of intensified market competition, the risk of price fluctuation of main raw materials, and the risk of shortage of car chip supply.
