\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 117 China National Chemical Engineering Co.Ltd(601117) )
Event:
On April 13, 2022, the company issued a business briefing. From January to March, 2022, the company achieved a cumulative operating revenue of 35.479 billion yuan, a year-on-year increase of 41.34%; The cumulative amount of newly signed contracts was 103914 billion yuan, a year-on-year increase of 90.05%. The newly signed contracts for construction projects amounted to 99.031 billion yuan, including 69.403 billion yuan for chemical engineering, 27.022 billion yuan for infrastructure and 2.606 billion yuan for environmental governance.
Key investment points:
The company’s operation was sound, and the newly signed contract amount and revenue increased significantly
In the first quarter, the company achieved a cumulative operating revenue of 35.479 billion yuan, a year-on-year increase of 41.34%; The newly signed contract amount was 103914 billion yuan, a significant increase of 90% year-on-year. 99.031 billion yuan of newly signed contracts for construction projects, including 69.403 billion yuan of newly signed contracts for chemical engineering; 27.022 billion yuan of newly signed infrastructure contracts; The newly signed contracts for environmental governance amounted to 2.606 billion yuan. The newly signed contract for survey, design, supervision and consultation is 1.342 billion yuan; Industrial and new material sales of 2.294 billion yuan; The newly signed contracts for modern services amounted to 1.137 billion yuan. In the first quarter, the company signed 39 major contracts with a single contract value of more than 500 million yuan, including chemical projects such as BDO, PVC, caustic soda, degradable plastics and polysilicon, as well as agricultural and environmental protection projects. The newly signed contracts within the territory of the company amounted to 93.008 billion yuan, an increase of 86% year-on-year; Overseas new contracts amounted to 10.906 billion yuan, a year-on-year increase of 135%, and China’s foreign businesses achieved rapid growth.
Construction in progress in the chemical industry has rebounded, and the company’s engineering business is expected to benefit
The chemical industry is cyclical. In 2020, affected by the epidemic, the economy weakened and the investment in the chemical industry slowed down. With the global economic recovery, the new demand of the chemical industry is strong, and the overseas production is limited. The rebound of China’s chemical products has led to the rapid recovery of industrial investment. In 2021, under the dual carbon policy, the expansion speed of some differentiated production capacity in the chemical industry has accelerated, resulting in a differentiated expansion cycle. From the perspective of construction in progress / fixed assets of Listed Companies in the chemical industry, the construction in progress in the chemical industry has been expanding since 2018. It fell slightly affected by the epidemic in 2020 and ushered in a strong rebound in 2021. At present, driven by the dual control of energy consumption, the transformation of chemical product market, the continuous improvement of chemical facility safety and environmental protection requirements, the whole industry has rapidly eliminated backward production capacity, accelerated the transformation of old and new kinetic energy, accelerated the process of chemical enterprises leaving the city and entering the park, and there are great market opportunities in the fields of chemical plant relocation and park upgrading in the future. At the same time, the dual carbon policy and environmental protection requirements have spawned the demand for new chemical products, and the domestic substitution process in the field of new materials has accelerated. Through years of technology accumulation, the company is expected to benefit from the explosive growth of new material engineering projects. From the performance of the first quarter of 2022, the newly signed contract amount of the company has increased significantly, which is inseparable from the trend of capacity expansion in the chemical industry.
Specialized in core technology to support engineering and industrial development
China National Chemical Engineering Co.Ltd(601117) as a bridge between science and technology and real productivity, give full play to the collaborative innovation mode of “industry university research and design”, and use its process technology research, engineering amplification and system integration capabilities to play a key role in the scientific and technological innovation chain from laboratory to industrialization. Among them, caprolactam technology has realized industrial transformation. New materials such as adiponectin, gel and PBAT have been built, and diesel exhaust catalysts, propylene oxide and other technologies are being planned for industrial projects. The company also focuses on a number of medium and high-end high value-added product technology fields such as polyolefin elastomer (POE), environmental protection catalyst, PBAT, ASA resin, polyimide, flame retardant nylon, nylon 12, waste gasification, hydrogen energy storage and transportation, and orderly promotes the small-scale research and development, pilot scale expansion and industrial transformation of key technologies. Coal to natural gas, coal to ethylene glycol, pulverized coal pyrolysis, large-scale methanol, large-scale synthetic ammonia, urea, wet process phosphoric acid, large-scale soda ash, polysilicon, photothermal power generation, LNG storage tank, molten salt storage tank and other technologies have been applied in EPC project. Strong technical reserve guarantee makes it possible for the company to play an unlimited role in the limited market.
The three major new material projects are close to being put into operation, and several projects under construction have made steady progress
The company has successfully built three new chemical materials, including adiponectin and nylon, gel and degradable plastics. Tianchen Qixiang adiponitrile project has entered the staggered period of intermediate delivery and trial production, and the bulk chemical raw materials required for production have entered the site. At present, the acrylonitrile plant has produced qualified products; The hexanediamine plant was successfully started on March 31, and the first batch of qualified products were successfully produced, and the product quality reached the high-grade products; The adiponitrile unit is expected to produce qualified products in early April 2022. The new material aerogel gel successfully launched in February 27, 2022. The first batch of qualified silicone based nano gel aerogel composite insulation felt has been produced. The first phase of the 100000 t / a PBAT degradable plastic project has been successfully mechanically completed and entered the trial production stage. At the same time, the company has also made breakthroughs in many other projects. The company plans to invest in the construction of propylene oxide projects and phosphorus chemical projects, further build the carbon three industrial chain and the industrial chain of “phosphate rock phosphoric acid high purity phosphoric acid iron phosphate phosphorus based high-end chemicals” and expand the industrial territory. During the 14th Five Year Plan period, the company will adhere to its advantages, focus on its main business, take strategic emerging industries as the core, extend to the upstream and downstream of the industrial chain, form an integrated advantage and move towards a broader market.
Profit forecast and investment rating: it is estimated that the net profit attributable to the parent company in 2021, 2022 and 2023 will be RMB 4338, 6.349 and 7.568 billion respectively, and the corresponding PE will be 14.01, 9.57 and 8.03 times respectively, maintaining the “buy” rating.
Risk tips: increased market competition, lower than expected downstream demand, production safety and environmental protection risk, lower than expected project construction progress, lower than expected global epidemic control risk, lower than expected downstream demand risk, price fluctuation risk of industrial products, and failure risk of projects under research
