\u3000\u3 China Vanke Co.Ltd(000002) 196 Zhejiang Founder Motor Co.Ltd(002196) )
Event:
The company officially disclosed the annual report of 2021 and the first quarterly report of 2022 on April 14, 2022. In 2021, the company achieved a total revenue of 1.891 billion yuan, a year-on-year increase of 65.47%; The net profit attributable to the parent company was 25 million yuan, with a year-on-year increase of 103.94%, turning losses into profits; The basic EPS is 0.05 yuan / share. In the first quarter of 2022, the company achieved a revenue of 571 million yuan, a year-on-year increase of 37.96%; The net profit attributable to the parent company was 06 million yuan, a year-on-year decrease of 12.29%; The basic EPS is 0.01 yuan / share.
Comments:
Benefiting from the rapid development of new energy vehicle industry
Benefiting from the rapid development of the new energy vehicle industry, the company’s new energy vehicle drive motor business increased by 188% in 2021 compared with the same period of last year, and the scale effect began to show. However, due to the rapid and sharp rise in the prices of bulk commodities such as copper, silicon steel sheet, aluminum and rare earth, the cost rise cannot be transmitted to downstream customers in the short term, resulting in the company’s comprehensive gross profit margin falling 1.65pct to 8.83%. At the same time, due to other reasons, the company made an asset impairment provision of 29.04 million yuan for inventories and intangible assets. However, in this case, the company still turned losses into profits. In 2021, the net profit attributable to the parent company was 25 million yuan, with a year-on-year increase of 103.94%.
The supply of drive motor products exceeds the demand, and the market share ranks among the top three
After years of technology accumulation and market development, the company’s new energy drive motor products have been recognized by customers, and supporting supply relationships have been established with Geely, SAIC GM Wuling, Xiaopeng, Weilai, Chery and other customers, and the company’s production capacity has always maintained full capacity. Thanks to the hot sales of Hongguang miniev, Xiaopeng P7 and other models, the company’s drive motor market share ranked third in China in 2021, second only to Byd Company Limited(002594) and Tesla.
Increase production and consolidate the leading position
In order to meet the growing demand of downstream customers, the company began to expand production in the second half of 2021. The company plans to raise no more than 1 billion yuan, of which 700 million yuan will be used to expand the production capacity of 1.8 million sets of new energy vehicle drive motors, mainly flat wire motors.
Profit forecast and investment suggestions
Considering that the impact of the price rise of upstream raw materials has not been eliminated this year, we expect the company’s operating revenue to be 2.963/4.773 billion yuan and the net profit attributable to the parent company to be 103 / 259 million yuan respectively from 2022 to 2023 (the previous value is 156 million yuan and 265 million yuan). At the same time, we also increase the profit forecast for 2024. The revenue is 7.73 billion yuan, the net profit is 420 million yuan, the corresponding EPS is 0.21/0.52/0.84 yuan / share and the corresponding PE is 37.7x/15x/9.2x. Maintain the “buy” rating.
Risk tips
1) risk that the sales volume of new energy vehicles is lower than expected; 2) The risk of intensified industry competition; 3) Upstream raw material price rise risk; 4) Goodwill impairment risk.
