\u3000\u3 Guocheng Mining Co.Ltd(000688) 516 Wuxi Autowell Technology Co.Ltd(688516) )
Event: the company announced its 2021 annual report. In 2021, the company achieved a revenue of 2.05 billion yuan, a year-on-year increase of + 79%; The net profit attributable to the parent company was 370 million yuan, a year-on-year increase of + 139%.
Key investment points
Benefiting from the high prosperity of the industry, the leading performance of component equipment continued to exceed expectations: the company’s performance continued to exceed expectations in 2021, and the profit growth rate exceeded the revenue growth rate. In 2021, the revenue reached 2.05 billion yuan, a year-on-year increase of + 79%; The net profit attributable to the parent company was 370 million yuan, a year-on-year increase of + 139%, exceeding the expected net profit attributable to the parent company of 360 million yuan in the performance express; Deduct the net profit not attributable to the parent company of RMB 330 million, a year-on-year increase of + 138%. Q4 single quarter revenue was 620 million yuan, a year-on-year increase of + 26% and a month on month increase of + 23%; The net profit attributable to the parent company was 140 million yuan, with a year-on-year increase of + 66% and a month on month increase of + 68%; The net profit deducted from non parent company was 120 million yuan, with a year-on-year increase of + 56% and a month on month increase of + 55%.
The gross profit margin increased steadily in 2021, focusing on the significant increase of Q4 net profit margin: (1) the comprehensive gross profit margin in 2021 was 37.7%, with a year-on-year increase of + 1.6pct; The net profit margin of sales was 17.9%, year-on-year + 4.4pct; The deduction of non net interest rate was 15.9%, a year-on-year increase of + 4pct, mainly due to the decrease and thickening of the expense rate during the period. The expense rate during 2021 was 17.3%, a year-on-year increase of -0.3pct. (2) In Q4 single quarter, the comprehensive gross profit margin was 36.6%, year-on-year -2.8pct and month on month -1.1pct; The net profit margin of sales was 23.3%, with a year-on-year increase of + 5.8pct and a month on month increase of + 7.2pct; Deducting non net interest rate was 19.5%, with a year-on-year increase of + 3.8pct and a month on month increase of + 4.1pct. Among them, the expense rate during Q4 was 14.1%, with a year-on-year increase of + 1.7pct and a month on month increase of – 5.1pct. The year-on-year increase in the expense rate during Q4 was mainly due to the fact that the R & D expense rate of Q4 was 6.8%, with a year-on-year increase of + 2.6pct. (3) Excluding other income (government subsidies), net investment income and net income from changes in fair value in Q4, the net profit attributable to the parent company is 99 million yuan, compared with 62 million yuan in 2020q4, a year-on-year increase of + 60%; The net interest rate attributable to the parent company was 16%, compared with 13% in 2020q4, a year-on-year increase of + 3PCT.
Contract liabilities & high increase in inventories, full orders and strong certainty of performance: by the end of 2021, the company’s contract liabilities were 1.14 billion yuan, a year-on-year increase of + 70%; The inventory was 1.85 billion yuan, a year-on-year increase of + 44%. The main reason is that the company has sufficient orders. In 2021, the newly signed orders were 4.28 billion yuan (including tax), a year-on-year increase of + 61%; By the end of 2021, the company’s orders on hand were 4.26 billion yuan (including tax), a year-on-year increase of + 77%.
With rich technical reserves, it has grown into an automation platform company spanning photovoltaic, lithium battery and semiconductor: (1) semiconductor bonding machine: on April 6, 2022 Wuxi Autowell Technology Co.Ltd(688516) received Tongfu Microelectronics Co.Ltd(002156) batch bonding machine order. (2) Photovoltaic field: single crystal furnace obtains GW order; Sintering annealing furnace (light injection) gradually increases in volume with the expansion of the market scale of n-type battery chip (TOPCON); Smbb ultra-fine wire multi main grid series welding machine has won large orders from well-known photovoltaic enterprises. (3) Lithium battery equipment: it is a high growth business with a low base. In 2021, it won the order of 130 million yuan from honeycomb (module pack line).
Profit forecast and investment rating: with the continuous prosperity of photovoltaic module equipment + smooth expansion of new fields, we expect the net profit attributable to the parent company from 2022 to 2024 to be 5.5 (up 9%) / 7.9 (up 19%) / 1.1 billion yuan respectively, corresponding to the current PE price of 34 / 24 / 17 times, raising the “buy” rating.
Risk tip: the expansion of new products is less than the market expectation, and the expansion of downstream production is less than the market expectation.
