In 6 Brother Enterprises Holding Co.Ltd(002562) 1, the volume and price rose together, creating the best performance of listing, and Q1 in 22 made a good start

\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 256 Guanghui Energy Co.Ltd(600256) )

Event: on April 15, 2022 Beijing time, Guanghui Energy Co.Ltd(600256) released the annual report of 2021 and the first quarterly report of 2022. In 2021, the net profit attributable to the shareholders of the listed company was 5.003 billion yuan, with a year-on-year increase of 274.40%, creating the best performance of Guanghui Energy Co.Ltd(600256) since its listing in 2000. In Q1 2022, the net profit attributable to the shareholders of the listed company was 2.213 billion yuan, a year-on-year increase of 175.59%, setting a new high in the company's performance in the first quarter.

Comments:

In the whole year of 21 and 22q1, the performance reached a new high, and the volume and price of each business segment increased simultaneously. The outstanding performance in 2021 is due to the high price and release period of the company's products in all sectors (natural gas, coal, methanol, coal tar, etc.). In terms of volume improvement, the main business products continued to show the trend of booming production and sales. Among them, the annual LNG sales increased by 22.28% year-on-year, and the sales of Qidong trading gas increased by 30.66% year-on-year; The annual coal sales volume increased by about 91% year-on-year (the external sales volume includes raw coal, upgraded coal and some purchased coal); The annual methanol sales volume increased by 11.05% year-on-year; The annual sales volume of coal based oil products increased by 14.72% year-on-year. In terms of price, the average sales price of LNG market increased by about 56% year-on-year; The sales price of coal market of each sub category increased by about 60-100% year-on-year; The average selling price of methanol increased by about 72% year-on-year; The average sales price of coal based oil products increased by about 59% year-on-year. In Q1 of 22 years, the company's LNG sales increased by 9.53%, coal sales increased by 29.69% and coal chemical products sales increased by 5.58% year-on-year. It continued to maintain the good trend of simultaneous increase in the volume and price of main products and successfully achieved a good start in 2022.

The company's capacity release will continue until 2025, and the LNG and coal business will still double in the next few years. In terms of LNG business, the company's LNG terminal and supporting projects in Lvsi port area of Nantong port, Jiangsu Province are under construction. We expect that the turnover capacity will reach 5 million tons after the completion of 5 tanks in 2022. After the expansion of 6, 7 two tanks and wharf berths, the turnover capacity is expected to reach 10 million tons, doubling the growth. In terms of coal sector, Yiwu mining, a holding subsidiary, has obtained the exploration certificate of Malang coal mine in Naomaohu mining area. We expect the coal production capacity to reach 40 million tons / year in 2022. In the coal chemical industry sector, Hami Guanghui raw gas comprehensive utilization project with an annual output of 400000 tons of ethylene glycol is expected to be completed and put into operation this year. The company will continue to release new production capacity in the next few years, which is expected to bring strong support to performance growth.

Due to the volatile situation in Russia and Ukraine and other factors, natural gas prices are expected to remain high and continue to drive the company's performance. In Q1 2022, the situation in Russia and Ukraine suddenly changed. Russian President Vladimir Putin issued the "ruble settlement order" for Russian gas. The European energy crisis has arrived, and the international natural gas price soared and spread to China. In March, the average value of China's LNG was 7734 yuan / ton, up 1718 yuan / ton month on month, or 28.56%. The company's self-produced gas will directly benefit from the rise in natural gas price. Trade gas has capacity expansion, and the company has signed a long-term agreement to ensure profitability. On the whole, the company's natural gas sector is expected to significantly boost the company's performance in the future.

Profit forecast and investment rating: we expect the company's operating revenue to reach 41.226 billion yuan, 51.241 billion yuan and 61.545 billion yuan respectively from 2022 to 2024, with a year-on-year increase of 65.80%, 24.29% and 20.11%. The net profits attributable to the shareholders of the parent company are 9.221 billion yuan, 11.097 billion yuan and 13.483 billion yuan respectively, with a year-on-year increase of 84.30%, 20.35% and 21.50%. The diluted EPS from 2021 to 2023 will reach 1.40 yuan, 1.69 yuan and 2.05 yuan respectively. The corresponding PE in 2022 is 7 times, maintaining the "buy" rating.

Risk factors: 1. The risk of sharp fluctuations in natural gas prices 2. The risk that the project in Kazakhstan is not advancing as expected

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