\u3000\u3 China Vanke Co.Ltd(000002) 126 Zhejiang Yinlun Machinery Co.Ltd(002126) )
The company released its 2021 annual report, and achieved a total operating revenue of 7.82 billion yuan (+ 23.6%); The net profit attributable to the parent company is 220 million yuan (- 31.5%); The earnings per share is 0.28 yuan, and it is proposed to distribute a cash dividend of 0.8 yuan (including tax) for every 10 shares. Among them, Q4 achieved an operating revenue of 1.98 billion yuan (+ 9.3%) and a net profit attributable to the parent company of 05 million yuan (- 89.1%). Affected by the rise in the price of raw materials, asset impairment, gains and losses from changes in fair value, the performance was lower than expected. Benefiting from the promotion of new energy, passenger cars, tail gas treatment and other businesses, the company's short-term performance is expected to resume growth. In the long run, the company has outstanding competitiveness in the fields of new energy and heat management, the global share is expected to continue to increase, the product line is continuously expanded, and the future development is promising. Recently, the company issued the draft stock option incentive plan, which is expected to improve the enthusiasm of core employees and promote sustainable development. We expect the company's earnings per share from 2022 to 2024 to be 0.53 yuan, 0.78 yuan and 0.99 yuan respectively, maintaining the buy rating and continuous recommendation.
Key points supporting rating
Q4 revenue increased slightly, and the price rise and impairment of raw materials dragged down the performance. Despite the impact of adverse factors such as epidemic situation and chip shortage, in 2021, the company's commercial vehicle and non Road business achieved revenue of 5.04 billion yuan (+ 11.1%), passenger vehicle business revenue of 2.24 billion yuan (+ 64.7%), and the overall revenue increased by 23.6%, better than the industry. The overall gross profit margin decreased by 3.5pct year-on-year, which is expected to be mainly due to the rise in the prices of raw materials and freight. Sales expenses increased by 12.1%, mainly due to the increase of Three Guarantees, warehousing and other expenses; Administrative expenses increased by 10.3%, mainly due to the increase in employee compensation and depreciation and amortization. R & D expenses increased by 21.2%, mainly due to increased investment and labor costs; Financial expenses decreased by 0.8%, and the four expense rates decreased by 1.5pct year-on-year. Revenue growth, gross profit margin and expense ratio decreased, investment income decreased by 70 million year-on-year, and net profit attributable to parent decreased by 31.5%. The gross profit margin of the company decreased by 2.3% year on year; The sales and R & D expenses increased significantly, the management and financial expenses decreased, the four expense rates decreased by 0.8pct, the impairment of assets and credit increased by 53 million yuan, the income from changes in fair value decreased by 44 million, the net profit attributable to the parent company was 05 million (- 89.1%), and the net profit deducted from non net profit was 23 million (+ 14.7%), and the performance was lower than expected.
The proportion of new energy revenue increased rapidly, and multi-point flowering helped the performance growth. In 2021, the company's new orders are expected to increase its annual revenue by 4.12 billion yuan, of which new energy accounts for 48.7%, and the business structure continues to be optimized. In 2022, new energy vehicles outside China will continue to grow rapidly, and the company's revenue from new energy products is expected to account for more than 25%. With the gradual easing of chip shortage, China's passenger car sales are expected to pick up, and the company is expected to continue to benefit. In the field of commercial vehicles, the implementation of national six year plan has led to short-term pressure on commercial vehicle sales, which is expected to rebound in the second half of the year; The value of the company's post-processing packaging and other products has increased significantly. Coupled with new products such as heavy truck retarder, the revenue is expected to grow against the trend. The company's new energy, passenger car and commercial vehicle businesses are blooming in many places, and the focus is gradually shifting from revenue to profit, and the performance is expected to resume growth.
In the long run, the global share will increase and the product line will expand. From the perspective of global industrial competitiveness, Chinese parts enterprises have obvious advantages in cost and service. With the continuous progress of technology and the continuous improvement of competitiveness, they are expected to obtain more orders. In recent years, European and American competitors have been shrinking in the fields of heat management and emission treatment. The company continues to obtain orders in relevant fields, the global share has increased steadily, and the long-term development is promising. In addition, the company's product line continues to expand, from parts to suppliers of thermal management system solutions, the market space is further expanded, and the prospect of new energy thermal management is expected.
Valuation
Affected by the rise in the price of raw materials, we adjusted our earnings forecast. It is expected that the company's earnings per share in 20222024 will be 0.53 yuan, 0.78 yuan and 0.99 yuan respectively, maintaining the buy rating.
Main risks of rating
1) car sales decline; 2) Price increase of raw materials and price reduction of products; 3) The new energy business was less than expected.
