\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 499 Keda Industrial Group Co.Ltd(600499) )
Events
Recent announcements of the company: 1) annual report of 2021: during the reporting period, the company achieved an operating revenue of 9.797 billion yuan, a year-on-year increase of 34.24%; The attributable net profit was 1.006 billion yuan, a year-on-year increase of 284.60%; The attributable net profit after deduction was 952 million yuan, a year-on-year increase of 940534%; 2) The proposed non-public offering of shares will raise no more than 2.079 billion yuan, mainly invested in intelligent manufacturing projects of building materials and lithium battery equipment, large-scale high-end intelligent equipment manufacturing digital factory projects, etc. In this regard, our comments are as follows:
The three businesses have blossomed together, and the profitability has improved significantly
During the reporting period, the company achieved an operating revenue of 9.797 billion yuan, a year-on-year increase of 34.24%; The attributable net profit was 1.006 billion yuan, a year-on-year increase of 284.60%, in line with market expectations. The significant increase in performance is mainly due to the flowering of three major businesses: 1) Lanke lithium industry has benefited from the rise in lithium carbonate price and the release of production capacity, ushering in a simultaneous rise in volume and price. In 2021, the output / sales of lithium carbonate were 22700 / 19200 tons respectively, and the company confirmed an investment income of 444 million yuan; 2) Benefiting from the epidemic, the building ceramics business increased its production capacity and gross profit margin, realizing a revenue of 2.345 billion yuan (+ 31.05%) and a net profit of 819 million yuan (+ 100.21%); 3) Thanks to the performance of building materials and other products, the revenue increased steadily by RMB 1.757 billion, driven by the performance of machinery and other products. The gross profit margin / net profit margin of the company was 25.97% / 14.93% respectively, with a year-on-year increase of 2.87/9.12pct respectively, and the profitability was greatly improved. The company’s sales / management / R & D / financial expense rates were 5.18% / 6.61% / 3.08% / 0.99% respectively, with a year-on-year decrease of 0.72/0.18/1.19/1.57pct respectively, and the expense rate during the period decreased by 3.67pct year-on-year. The net cash flow from operating activities was 1.288 billion yuan, an increase of 8.79% year-on-year.
The volume and price of Lanke lithium industry rose simultaneously, and new performance highlights of negative electrode materials
Lanke lithium (43.58% equity), a joint-stock company, produced and sold 22700 / 19200 tons of lithium carbonate in 2021, including 3500 tons of inventory, which is expected to be sold in 2022q1. The new 20000 ton battery grade lithium carbonate project of Lanke lithium industry has carried out single machine commissioning. In 2022, based on the existing capacity of 30000 tons of lithium carbonate, Lanke lithium industry is expected to produce more than 30000 tons through technology improvement and increasing adsorption efficiency. With the rise of lithium carbonate price, Lanke lithium industry will usher in the stage of simultaneous increase of volume and price, and the investment income of the company will be improved. At the same time, the negative electrode material business has formed an integrated capacity layout of “50000 T / a forged coke-30000 T / a graphitization-10000 T / a artificial graphite-1000 T / a silicon carbon negative electrode” through the introduction of partners and shareholder batery. In 2022, the capacity construction of 10000 t / a graphitization and 10000 t / a artificial graphite products will continue. Fujian Kehua has obtained the approval of 50000 T / a graphitization, The negative electrode material business will become a new performance growth point of the company.
Building ceramics: new production lines and new products are expanded simultaneously, and steady growth can be expected
The company began to invest in building ceramics business in Africa in 2016. At present, the company has built 12 ceramic production lines in five countries: Kenya, Ghana, Tanzania, Senegal and Zambia, with a production capacity of more than 90 million square meters / year, with an average market share of 50% in these countries. The company has planned the fourth phase and fifth line of Ghana ceramic factory, Kisumu factory in Kenya, Cameroon, C ô te d’Ivoire and other countries’ building ceramic projects, which are expected to be put into operation in 2022, and the production capacity will exceed 100 million square meters in 2-3 years. In addition, the company is also actively carrying out research and Exploration on new products, positioning its business in Africa as transforming from a professional ceramic tile manufacturer into a one-stop home center, To achieve the coverage of high, middle and low-end household products in Africa and establish a full range of household ecology, preparations for the sanitary ware project in Ghana have been launched. The company continues to dig deep into the African market, the current production line and new products are expanded simultaneously, and the African business can grow steadily.
Raise funds and invest in lithium battery equipment and intelligent manufacturing projects to help the new growth of building materials machinery
The company plans to issue no more than 567 million non-public shares to no more than 35 specific objects, and raise no more than 2.079 billion yuan. The raised funds are mainly invested in: 1) the project with an annual output of 1.6145 million pieces (sets) of building materials and equipment and 85 sets (sets) of lithium equipment roller kilns; 2) Production line project with an annual output of 300 sets of large-scale high-end intelligent equipment products; 3) Intelligent building materials machinery technical transformation project, with an annual output of 650 units (sets); 4) Replenish working capital. The fixed raising and investment projects are carried out around the main business. On the one hand, it is conducive to improving the supply capacity of the company’s existing whole line products and the degree of intelligent equipment, strengthening the business strength of the original building materials machinery sector and optimizing the allocation of resources; On the other hand, on the basis of developing the main business of traditional ceramic machinery, focusing on the cross domain application of ceramic machinery equipment in lithium battery equipment, it forms a strategic synergy with the existing lithium battery material business sector. At the same time, it implements the “press diversification” development strategy and produces high-end medium and large-scale aluminum profile extruders, which is conducive to the company’s expansion of new business fields and the new growth of building materials machinery.
Profit forecast
According to the price of lithium carbonate, we raised the company’s profit forecast without considering the impact of this fixed increase. It is predicted that the company’s revenue from 2022 to 2024 will be 11.397 billion yuan, 12.591 billion yuan and 13.870 billion yuan respectively, EPS will be 2.23, 2.36 and 2.38 yuan respectively, and PE corresponding to the current stock price will be 7.9, 7.5 and 7.4 times respectively, maintaining the “recommended” investment rating.
Risk tips
Macroeconomic downside risk, slow progress of overseas projects, lower than expected capacity expansion and sales of Lanke lithium industry, lower than expected demand for lithium battery, lower price of lithium carbonate, higher price of raw materials, further aggravation of covid-19 epidemic, reduction of shareholders’ holdings and failure to complete the fixed increase.
