\u3000\u3 China Vanke Co.Ltd(000002) 541 Anhui Honglu Steel Construction(Group) Co.Ltd(002541) )
Event: Anhui Honglu Steel Construction(Group) Co.Ltd(002541) announcement the first quarter of 2022 Business Briefing. From January to March 2022, the newly signed sales contract amount of the company was about 6.013 billion yuan, an increase of 14.71% at the same time; The output of steel structure products was about 702000 tons, an increase of 2.17% at the same time.
Comments:
22q1 operation is affected by epidemic factors, and the growth rate of newly signed orders is still marginally improved. The number of new orders signed by the company in 22q1 increased by 9% on a ring basis, rebounding from the growth rate in 21q4 (the amount of new orders signed in 21q4 increased by – 19% on a ring basis), and there are signs of marginal improvement. Combined with the production capacity of the company in 21 years (the self consumption of steel structure in the construction plant increased by 66%), we believe that the growth rate of new orders signed by the company in 22q1 is lower than the actual expansion rate of production capacity, or affected by epidemic factors: the epidemic broke out in many places in China in March 22, some construction sites were shut down or delivery was blocked due to logistics and transportation, which affected the willingness to sign orders. After the epidemic situation is gradually controlled, it is expected that the growth rate of new orders signed by the company will further pick up, matching the progress of production capacity.
The output of 22q1 steel structure increased slightly, which was obviously affected by the epidemic. The output of 22q1 steel structure of the company was 702000 tons, an increase of 2.17% at the same time, which was lower than the year-on-year growth rate in the past four quarters (the year-on-year growth rates of 21q1-21q4 were 145%, 28%, 23% and 14% respectively). We judged that the weak demand combined with the impact of the epidemic caused the slowdown of output growth: 1) in 21q2, the downstream demand slowed down significantly due to the rapid rise of steel price. After the decline of 21h2 steel price, the downstream demand recovery is still relatively slow, or affected by the weak real estate investment and infrastructure investment; 2) The epidemic of 22q1 has a certain impact on both sides of the company’s supply and demand. The slowdown of downstream delivery leads to the slowdown of the company’s delivery volume. At the same time, logistics factors affect the transportation and acquisition of raw materials, and the attendance rate of some base employees decreases; The above factors jointly affected the company’s production and led to the slowdown of the company’s output growth.
The proportion of large orders has increased significantly, and the leading competitive advantage has gradually emerged. In 22q1, the amount of large orders (orders with an amount of more than 100 million yuan or processing capacity of more than 10000 tons) of the company was 2.2 billion yuan, accounting for 37% of the total orders, which was significantly higher than that of the previous year (24% in 21q1 and 21% in the whole year of 21); The processing volume of large orders reached about 340000 tons, an increase of about 56% at the same time. The proportion of large orders and processing volume of the company have significantly increased to a higher level than that of the previous year, indicating that the cooperation between the company and large customers is gradually increasing, and the leading competitive advantage is further reflected.
Profit forecast, valuation and rating: Anhui Honglu Steel Construction(Group) Co.Ltd(002541) is a leading company in the field of steel structure manufacturing with the clearest growth in the fabricated industry chain and significant industry competitiveness. It will benefit from the rapid growth of the fabricated industry and the tight balance between the supply of steel structure processing links for a long time. 22q1, the company’s operation was affected by the epidemic to a certain extent, but its competitive advantage was further strengthened. Maintain the forecast of the company’s net profit attributable to the parent company from 2022 to 2024 of 1.508 billion yuan, 1.751 billion yuan and 2.102 billion yuan. The current price corresponds to a dynamic P / E ratio of 15x in 2022. Firmly optimistic about the long-term value of Anhui Honglu Steel Construction(Group) Co.Ltd(002541) and maintain the “buy” rating.
Risk tip: the sharp fluctuation of steel price affects the company’s profitability, capacity expansion and utilization rate
