\u3000\u30 Shenzhen Fountain Corporation(000005) 91 Cecep Solar Energy Co.Ltd(000591) )
Event:
The company released its annual report for 2021 on April 14, 2022, realizing an operating revenue of 7.016 billion yuan, a year-on-year increase of 32.25%; The net profit attributable to shareholders of listed companies was RMB 1.181 billion, a year-on-year increase of 14.87%, and the net cash flow from operating activities was RMB 2.049 billion, a year-on-year decrease of 3.34%. In 2021, the gross profit margin of battery module business was subject to high price silicon materials, resulting in lower than expected profits.
Comments:
The business of the power station is stable, and the battery components are pressed by raw materials
In 2021, the company’s comprehensive gross profit margin was 41.67%, a year-on-year decrease of 6.75pct. Affected by the high silicon material price, the company’s battery module business cost increased higher in some quarters, and the comprehensive gross profit margins from Q1 to Q4 were 38.30% / 48.09% / 45.94% / 33.90% respectively. In 2021, the net interest rate of the company was 16.61%, a year-on-year decrease of 2.60pct, of which the net interest rates from Q1 to Q4 were -,
Affected by asset impairment, rising raw material costs and rising management expenses, the net interest rate decreased significantly in the fourth quarter. In 2021, the net profit attributable to the parent company was 1.181 billion yuan, with a year-on-year increase of 14.87%. In this year, the net profit not attributable to the parent company was 1.062 billion yuan.
The power generation end continues to make efforts to lock in high-quality projects in advance
At the end of the year, the installed capacity of PV in operation of the company was 4.27gw, the project under construction was 0.7gw and the proposed project was 1.12gw. The company’s photovoltaic power station management capacity has been continuously optimized, the cost has been reduced year by year, and the gross profit margin of power generation has maintained a steady upward trend, rising from 63.39% in 2017 to 65.20% in 2021. The company has locked about 15gw of high-quality construction and acquisition projects in advance in areas with good light resources, policies and development conditions, so as to improve the ceiling of new energy development again.
Subsidy payment is the company’s re injection of growth
At the end of 2021, the company did not receive new energy electricity price subsidies totaling 9.744 billion yuan, accounting for 98.33% of its accounts receivable, which is 1.39 times its operating revenue in 2021. In 2022, the expenditure of other government funds in the expenditure budget table of central government funds will increase significantly to 459.4 billion yuan. We predict that in 2022, new energy subsidies will be paid more than 450 billion yuan at one time, and the problem of arrears will be solved at one time. According to the calculation of 30% capital, the subsidy of 9.744 billion yuan can pry the construction of 8.1gw photovoltaic power station.
The yield of battery module manufacturing business improved quarter by quarter
On April 13, the price of silicon material rose for 13 consecutive weeks, with the highest average price reaching 251.5 yuan / kg, returning to the high price. However, with the continuous release of production capacity of Tongwei, Daquan, Xinte and other leading silicon material enterprises in the second, third and fourth quarters, we believe that the price of silicon material is expected to fall sharply to 150 yuan / kg-170 yuan / kg in the fourth quarter. The redistribution of industrial chain profits will continue to benefit the links of battery chips and components, and the company’s gross profit margin will return to the normal level.
Profit forecast and investment suggestions
The company owns 4.27gw of photovoltaic power station assets and locks in about 15gw high-quality projects. Under the background of excess subsidies, the cash flow will be greatly improved and the project development will enter a new cycle. We estimate that the company’s revenue from 2022 to 2023 will be 7.48/8.91 billion yuan (original value: 8.17/10.6 billion yuan), and the net profit attributable to the parent company will be 1.74/2.58 billion yuan (original value: 2.01/2.74 billion yuan). At the same time, we will increase the 24-year profit forecast, the revenue will be 10.27 billion yuan, the net profit attributable to the parent company will be 3.28 billion yuan, and the EPS will be 0.58/0.86/1.09 yuan / share respectively, corresponding to 12.8/8.7/6.8 times of PE. We give the company 21 times PE for 22 years, and the target price will be 12.18 yuan, maintaining the “buy” rating.
Risk tips
The company’s power station development is less than expected, the subsidy payment is delayed, and the silicon material price remains high
