\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 586 Shandong Jinjing Science And Technology Stock Co.Ltd(600586) )
Event overview. The company announced the annual report of 2021 and the first quarterly report of 2022. In 2021, the company achieved revenue of 6.92 billion yuan, a year-on-year increase of 41.72%, net profit attributable to the parent company of 1.31 billion yuan, a year-on-year increase of 295.10%, corresponding to Q4 revenue of 1.83 billion yuan, a year-on-year increase of 25.11%, net profit attributable to the parent company of 59.77 million yuan, a year-on-year increase of - 59.54%; In 2021q1, the company achieved a revenue of 1.78 billion yuan, a year-on-year increase of + 21.20%, and a net profit attributable to the parent company of 145 million yuan, a year-on-year increase of - 59.16%; The company announced that the total repurchase amount of no more than RMB 100 million and no more than RMB 150 million in the form of centralized trading is no more than RMB 12 / share, and the obtained shares are used for the implementation of employee stock ownership plan or equity incentive.
As expected, the profit pressure of float glass is under pressure from 2021q4. The performance of 2021 and 2022q1 is basically in line with expectations. The overall completion demand in 2021 was good, driving the rise of glass demand. In the whole year, the company sold 33.61 million heavy boxes of glass (float glass + technical glass caliber), a year-on-year increase of + 10.1%. Thanks to the strong price rise in the first three quarters of 2021, the average selling price of the company's glass business in 2021 was 2550 yuan / ton, with a year-on-year increase of + 800 yuan / ton. Due to the rise of raw fuel costs such as soda ash, the company's ton cost also increased by about 100 yuan / ton, and the ton gross profit increased by 700 yuan / ton to 1108 yuan / ton year-on-year. Since 2021q4, with the decline of construction demand caused by real estate regulation and the continuous rise of soda ash cost, the profit of the company's glass business is under pressure. According to the disclosure of the company's annual report, the annual net profit of the glass sector is 1.09 billion yuan. According to this calculation, the 2021q4 glass industry is basically in the state of profit and loss balance, and it is judged that the main profit of the company in the fourth quarter is contributed by soda ash. As the price of soda ash in 2022q1 is lower than that in Q4, we estimate that the contribution of glass business in 2022q1 is slightly higher than that of soda ash.
Soda ash business rebounded in 2021h2. Benefiting from the growth of glass demand and supply disturbance, the price of soda ash has shown an upward trend since 2021h2, which has greatly improved the profit of the company's soda ash business. According to the data disclosed in the annual report, the company sold 1.32 million tons of soda ash in 2021, a year-on-year increase of - 15.0%. It is judged that it is mainly affected by device maintenance and production restriction in the fourth quarter; It is estimated that the average selling price of soda ash last year was 1539 yuan / ton, with a year-on-year increase of about + 470 yuan / ton. Due to the increase of coal and other energy prices, the cost of soda ash of the company increased year-on-year, but the gross profit per ton still increased by about 130 yuan / ton to 281 yuan / ton year-on-year. The company's annual report disclosed that the soda ash sector achieved a net profit of 283 million yuan, corresponding to a net profit of 214 yuan per ton, a significant increase year-on-year. In 2022q1, due to the decline of soda ash price month on month, we estimate that the company's net profit per ton of soda ash decreased month on month, but it still increased significantly year on year.
Photovoltaic glass business starts in 2021 and is expected to set sail in 2022. In 2021q4, the company's Ningxia 600t / D photovoltaic production line was put into operation. According to the announcement on March 15, 2022, the products have passed the other party's inspection and delivered Longji (2mm panels and backplanes for the first batch of 3 million square meters); Malaysia's 500t / D backplane production line 2022q1 is put into operation, and the 500t / D panel production line is expected to be put into operation in the second half of the year. Since the production line of photovoltaic glass business was put into operation at the end of 2021 and the beginning of 2022, it contributed less profits in 2021 and 2022q1. In 2022, the photovoltaic assets of Ningxia and Malaysia are expected to start to contribute.
In 2022, the profit of soda ash may be further improved, and the H2 glass business may pick up. Under the background of real estate policy correction, we maintain the previous judgment that the demand of H2 in the glass industry is better than H1. Due to the large number of elderly production lines in the industry, there is expected to be a significant decline in actual production capacity at the supply side, driving the improvement of prices month on month. Under the background of the recovery of building glass demand and the stable growth of photovoltaic glass demand, soda ash prices are also expected to continue the upward trend in 2022 and enter a year of real release. In addition, although the production expansion plan of photovoltaic glass is more radical, because the company's main production bases are located in Ningxia and Malaysia and have the advantages of energy cost, labor cost and tax cost, the photovoltaic glass business is also expected to become an important level of the company's growth after the photovoltaic production lines are put into operation.
New business reserves are abundant. Based on the annual report of TCO, the company has successfully developed and supplied ultra-high performance glass substrates in the field of 20210002 mm , which has been successfully approved by customers in China. At the same time, we have successfully developed tek5 ultra-low resistance products, overcome the problem of tempering stability of tek550, 180, 130 and other high resistance products, and realize batch stable production. When the market demand for BIPV cadmium telluride starts, the company is expected to take the lead.
The proposed repurchase further demonstrates confidence. The company announced that it plans to buy back at a total amount of no less than RMB 100 million and no more than RMB 150 million by means of centralized trading, and the obtained shares will be used for the implementation of employee stock ownership plan or equity incentive. After 15 years, the company plans to implement incentives again, which shows the company's confidence in long-term development in the future.
Investment suggestion: considering that since Q4, the price of glass has decreased a lot and the price of soda ash has increased a lot, reduce the assumption of glass price and increase the assumption of glass cost and soda price of the company. Adjust the revenue forecast of 2022 / 2023 to 9.95/11.39 billion yuan (Original: 10.28/11.77 billion yuan), and adjust the EPS forecast of 2022 / 2023 to 93 / 113 million yuan (Original: 148 / 164) million yuan. The new revenue is expected to be 12.98 billion yuan in 2024, eps1.5 billion yuan RMB 4 billion, EPS from 2022 to 2024 corresponds to the closing price of RMB 8.28 on April 11, with a closing price of 8.91/7.32/5.93xpe. Considering the good growth of the company's photovoltaic business and the repurchase or boost market confidence, the company raised the valuation to 202211xpe (Original: 10x), adjusted the target price to 10.23 yuan (Original: 14.80 yuan), and maintained the "buy" rating.
Risk tips
The demand is lower than expected, the cost is higher than expected, the production is slower than expected, and there are systemic risks.
