\u3000\u30003 Mesnac Co.Ltd(002073) 00207)
Event: on April 12, the company released its annual report for 2021, realizing an operating revenue of 37.359 billion yuan, a year-on-year increase of 25.82%; The net profit attributable to the parent company was 916million yuan, a year-on-year increase of 14.18%; The net profit deducted from non parent company was 528 million yuan, with a year-on-year increase of 101.72%. At the same time, the company issued a profit distribution plan and plans to distribute a cash dividend of 0.07 yuan / share to all shareholders.
Optimize the business structure and strengthen R & D: in 2021, the company achieved an operating revenue of 37.359 billion yuan, yoy + 25.82%, rapid and large-scale power batteries, and steady growth of consumer battery business; The net profit attributable to the parent company is 916 million yuan, yoy + 14.18%, deducting 528 million yuan, yoy + 101.72%. Specifically, in the automotive field, the proportion of power battery revenue increased significantly, reaching 7.85%, yoy + 6.41pct; In the field of consumption, the revenue of mobile phone digital / Laptop / intelligent hardware / precision structural parts business accounted for 55.66% / 14.51% / 13.40% / 5.84% respectively, and yoy + 0.41pct/0.53pct/ – 8.05pct/0.28pct. The company continued to increase R & D investment in core areas such as power batteries and consumer cells. The annual R & D cost reached 2.327 billion yuan, yoy + 28.81%, and the R & D cost rate was 6.23%, yoy + 0.14pct; The ability of expense management and control was further improved. The sales / management / financial expense rates were 0.75% / 4.00% / 1.40% and YoY － 0.10pct / + 0.17pct / － 0.29pct respectively.
The fixed-point projects have been smoothly promoted, and the power battery has a rapid volume: in 2021, the company’s electric vehicle battery business revenue was 2.933 billion yuan, yoy + 584.67%, realizing rapid growth; The gross profit margin is – 0.87%, yoy + 13.98pct, which is mainly affected by the price rise of raw materials, and there is still much room for improvement. The company’s power battery products focus on square aluminum shell cells, covering Bev, HEV, 48V and other application markets. Among them, Bev products cover two material systems: ternary / lithium iron phosphate. In addition to the field of vehicle, Bev products have also successfully entered the field of ship, and batch delivery has been realized; In addition to Nissan, Renault, Mitsubishi alliance and other international customers, HEV and 48V products also cooperate with most customers with HEV demand in China, and mass delivery is expected to start in 2022; In March 2022, the company announced that it was appointed as the designated point of SAIC zs12mcehev project, and the HEV battery business was further expanded. In addition, the company has obtained the fixed-point letters for the model projects of Dongfeng Liuqi Lingzhi cm5ev, Dongfeng E70, Geely PMA platform and other car enterprises. In terms of energy storage application, the company cooperates with the head company. It is expected to deliver in batch in 2022, and the fast charging field has also obtained the fixed-point models of many head customers. According to the data of China automotive power battery industry innovation alliance, the company’s total power battery shipment reached 3.52gwh in 2021, of which the loading volume in China was 2.06gwh, accounting for 1.3% of the market; In March 2022, the loading volume of the company in China was 0.35gwh, and the market share increased to 1.62%. The ranking in China rose from 10th to 9th, and the power battery business entered a period of rapid volume.
The production expansion of power batteries was accelerated, and the upstream and downstream cooperation ensured the digestion of production capacity: on the one hand, the company continued to promote the construction of production capacity. In August 2021, the subsidiary Sunwoda Electronic Co.Ltd(300207) automobile batteries and Geely and Jirun invested in the construction of cell, module and battery package production lines. The peak production capacity of phase I was no less than Shanghai Pudong Development Bank Co.Ltd(600000) HEV (including 48V) power battery packages, and that of phase II was increased to 800000; In the same month, it invested 20 billion yuan with Nanchang Economic Development Commission to build a power battery production base project, which was invested in four phases, and the annual capacity of 50gwh cells and 50gwh battery system were added after reaching the production capacity; In December 2021, Sunwoda Electronic Co.Ltd(300207) automobile battery plans to invest 20 billion yuan to build the “Zaozhuang project of power battery and energy storage battery with an annual capacity of 30gwh”, and the annual output value is expected to be about 20 billion yuan after it is completed; In March 2022, it is planned to invest 12 billion yuan to build “Zhuhai 30gwh power battery project”; In the same month, it is planned to invest 8 billion yuan to build “Shifang 20gwh power battery and energy storage project”. On the other hand, the company actively distributes upstream materials and strengthens cooperation with downstream auto enterprises. In December 2021, the company cooperated with Guizhou Chanhen Chemical Corporation(002895) to invest 7 billion yuan to build the “mineralization in one” new energy material recycling industry project. The first phase, with an investment of 3.5 billion yuan, has been started at the end of 2021 and is expected to be put into operation at the beginning of 2024, with an annual capacity of 200000 tons of food grade evolutionary phosphoric acid, 300000 tons of iron phosphate for battery and 30000 tons of anhydrous hydrogen fluoride. The second phase is expected to be started in 2024 and put into operation at the end of 2025; In February 2022, 19 enterprises planned to increase the capital of Sunwoda Electronic Co.Ltd(300207) automobile batteries by 2.43 billion yuan, of which chehejia (ideal automobile) and skytop LLC (Xiaopeng Series) led the investment of 400 million yuan and Weirui (Weilai Series) invested 250 million yuan respectively. SAIC, GAC and Dongfeng also increased their capital and added weight. The cooperative relationship is further stable and the new production capacity is expected to be fully digested.
The consumer business continues to be integrated and optimized, and the proportion of self supply of electric cells continues to increase: in 2021, the company’s mobile phone digital / Laptop / intelligent hardware / precision structural parts business revenue was 20.795/54.19/50.07/2.180 billion yuan, yoy + 26.77% / + 30.57% / – 21.37% / + 32.11%, and the gross profit margin was 18.39% / 8.52% / 9.61% / 18.69% respectively, of which the gross profit margin of precision structural parts increased significantly, yoy + 6.60pct. The company continues to deepen the business layout, and the proportion of self supply of electric cells continues to increase. The subsidiary Liwei phase I has achieved mass production, and the transformation of the fully automatic production line of lithium microelectronics minicell has been completed and put into use; In February 2022, the subsidiary xinzhiwang plans to invest 2 billion yuan with Ningxiang Economic Development Committee to build “xinzhiwang intelligent hardware Ningxiang comprehensive production base project”. The first phase investment is 500 million yuan, and 15 SMT and intelligent assembly production lines are planned to be built. The second phase is planned to be implemented in 2024; In March, the company announced that the actual fund-raising was about 3.9 billion yuan and the total investment was 4.25 billion yuan to invest in the production expansion projects of 3C consumer lithium-ion battery cell / battery module and laptop lithium battery module; In April, the precision structure business was internally integrated, and all the assets related to India Sunwoda Electronic Co.Ltd(300207) will be merged into India Yingwang to improve the efficiency of operation and management. With the increase of smart phone battery capacity and the penetration of laptop battery, the market demand for consumer lithium battery will continue to expand; As a leader in China, the company is expected to further expand its market share. At the same time, the business of intelligent hardware and precision structural parts continues to be integrated and optimized, and the performance growth can be expected.
Investment suggestion: we estimate that the company’s operating revenue from 2022 to 2024 will be 49.072 billion yuan, 57.164 billion yuan and 65.938 billion yuan respectively, the net profit attributable to the parent company will be 1.776 billion yuan, 2.492 billion yuan and 3.366 billion yuan respectively, and the EPS will be 1.00 yuan, 1.41 yuan and 1.90 yuan respectively, corresponding to 22.8 times, 16.2 times and 12.0 times of PE respectively, maintaining the “Buy-A” investment rating.
Risk warning: downstream demand is less than expected; Capacity construction and release are not as expected; Customer expansion was less than expected.
