\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 888 Xinjiang Joinworld Co.Ltd(600888) )
Event: Xinjiang Joinworld Co.Ltd(600888) released the annual report of 2021. During the reporting period, the company achieved an operating revenue of 8.226 billion, a year-on-year increase of 43.88%, a net profit attributable to the parent of 853 million, a year-on-year increase of 142.97%, and a net profit not attributable to the parent of 931 million, a year-on-year increase of 192.72%; In Q4 of 21 years, the operating revenue was 2.052 billion, with a year-on-year increase of 12.47%, a month on month decrease of 5.93%, and the net profit attributable to the parent company was 263 million, with a year-on-year increase of 137.43% and a month on month decrease of 2.04%.
During the reporting period, the volume and price of the company’s main products increased simultaneously, which promoted the high growth of the company’s performance.
In terms of volume, the downstream market demand for aluminum electronic materials was strong in 2021, and the production and sales volume of the company increased as a whole. During the reporting period, the company produced 69600 tons of high-purity aluminum (YoY + 2.89%), sold 36700 tons (YoY + 2.92%), produced 29300 tons of electronic aluminum foil (YoY + 21.63%), sold 21100 tons (YoY + 16.15%), produced 247656 million square meters (YoY + 32.03%), sold 255794 million square meters (YoY + 48.76%), produced 85800 tons (YoY + 31.03%) of aluminum alloy products and sold 79400 tons (YoY + 46.76%), The output of aluminum products is 70800 tons (yoy-7.28%), and the sales volume is 59200 tons (yoy-6.41%).
In terms of price, in 2021, under the influence of the red line of production capacity and the dual control policy of energy consumption, the overall supply and demand of the aluminum industry was tight, the prosperity of the industry continued to rise, and the aluminum price continued to be high. During the reporting period, the average price of aluminum A00 in the Yangtze nonferrous metals market was 1889811 yuan / ton (YoY + 33.18%).
The ability of cost control has been improved. The company’s expense rate for the period of 21 years was 6.44%, a decrease of 3.96 PCTs compared with the same period last year. Specifically, 1) the sales expense rate decreased by 1.39 PCTs from 2.22% → 0.83%, mainly due to the change of accounting standards. The relevant transportation costs were reclassified from “sales expenses” to “operating costs”. After restatement, the sales expense rate decreased by 0.08 PCTs from 0.90% → 0.83%; 2) Due to the increase of employee compensation and equity incentive expenses in the current period, the management expenses increased by 16.0% year-on-year to 232 million yuan, and the management expense rate decreased by 0.68 PCTs from 3.50% to 2.82%; 3) In terms of financial expenses, due to the year-on-year decrease of 13.57% in interest expenses in the current period, the financial expense rate decreased by 1.64 PCTs from 4.02% → 2.38%; 4) The R & D expense ratio decreased by 0.25 PCTs from 0.66% to 0.41%.
The high boom of aluminum electronic materials has raised the overall profit center. The demand of electrolytic capacitors and other new energy sectors increased by 58.5% in October 2021, driven by the rapid development of electrolytic capacitors and other factors, and the demand of electrolytic capacitors continued to rise by 58.5% in October 2024. It is expected that under the development trend of new energy, the price of aluminum electrolytic capacitor may continue to be high, and the prosperity of the company’s electrode foil products will remain.
The allotment project is expected to become a new performance growth point of the company. In April 2021, the company raised funds to invest in the existing pilot line expansion projects with an annual output of 15000 tons of three-layer high-purity aluminum capacity replacement and upgrading, an annual output of 3000 tons of high-strength and high toughness aluminum alloy and an annual output of 500 tons of ultra-high-purity aluminum base sputtering target blank, continued to strengthen the company’s development in the downstream market of high-purity aluminum, and may expand the company’s future incremental space.
Profit forecast and investment suggestions: benefiting from the tight supply and demand situation in the electrolytic aluminum industry and the development trend of new energy business, the high prosperity of the company’s main business is still expected to be maintained. We expect the output of electrode foil of the company to be 26 million / 26.5 million / 27 million square meters in 22-24 years. Under the assumption that the aluminum price is 2.0/2.121000 yuan / ton in 22-24 years and the sales unit price of electrode foil is 65 / 65 / 65 yuan / square meter, It is estimated that the net profit attributable to the parent company in 22-24 years is RMB 1.053/12.91/1.355 billion respectively (it is estimated that it is RMB 951/1.167 billion respectively in the previous 22-23 years), and the corresponding PE in 22-24 years is 10 / 8 / 8x respectively. Maintain the company’s “buy” rating.
Risk warning events: macroeconomic fluctuations and sharp fluctuations in product prices; Risk that the company’s profit level is lower than expected due to the sharp rise in the cost of raw materials; Downside risk of prosperity of electrode foil industry; The project under construction is less than the expected risk.
