\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 111 China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) )
In 2021, the net profit attributable to the parent company increased by 462.32% year-on-year, and the revenue and profit reached a record high: the company realized an operating revenue of 30.408 billion yuan in 2021, with a year-on-year increase of 38.83%; The gross profit margin was 27.84%, a year-on-year increase of 16 percentage points; The net profit attributable to the parent company was 5.130 billion yuan, a year-on-year increase of 462.32%; The net profit attributable to the parent company after deducting non-profit was 4.967 billion yuan, a year-on-year increase of 444.50%; The profit margin was 16.87%, a year-on-year increase of 13 percentage points; EPS is 1.41 yuan, of which Q4 single quarter eps0 55 yuan, a record high. The distribution plan is to distribute cash of 0.445 yuan per share.
The volume and price of raw materials and functional materials increased at the same time, driving the growth of performance, in which the gross profit of magnetic materials increased by two times: in 2021, the volume and price of rare earth raw materials and downstream materials of the company increased at the same time, in which the sales volume of rare earth raw materials was 137200 tons, a year-on-year increase of 32.99%; The unit price of rare earth raw material products was 81900 yuan / ton, a year-on-year increase of 55.89%; The revenue of rare earth raw materials was 11.234 billion yuan, a year-on-year increase of 107.31%, and the gross profit margin was 38.43%, an increase of 11 percentage points over the previous year; Among them, the income and gross profit of rare earth metals increased by 122.14% and 211.54% year-on-year respectively, contributing 38.9% and 39.8% of the total income and gross profit respectively. The sales volume of functional materials was 62800 tons, with a year-on-year increase of 15.88%, and the unit price was 117700 yuan / ton, with a year-on-year increase of 59.98%; The business revenue of rare earth functional materials was 7.398 billion yuan, with a year-on-year increase of 85.38%. Among them, the sub variety with the largest increase was magnetic materials, with a revenue of 6.576 billion yuan, with a year-on-year increase of 98.54%, and a year-on-year increase of 211.54% in gross profit. Its contribution to all revenue and gross profit reached 21.6% and 31.4% respectively; The overall gross profit margin of rare earth functional materials business reached 41.49%, an increase of 21.78 percentage points over the previous year.
In 2022, the pattern of simultaneous increase in volume and price of the company was initially locked, and the net profit in Q1 increased by 96.78% ~ 122.59% year-on-year: as the global leader of light rare earth, the company accounted for 67.42% and 55.33% of the light rare earth ore quota and smelting separation quota in the first batch of quotas in China in 2022, accounting for 95.71% and 95.74% of the corresponding quota increment, respectively. It is the core enterprise of rare earth production and the main source of growth. In terms of price, the prices of praseodymium oxide and neodymium oxide in Q1 increased by 128.86% and 82.77% year-on-year respectively, and 24.71% and 38.71% month on month compared with Q4 in 21 years; In terms of cost, in 2022, the trading price of rare earth concentrate between the company and Inner Mongolia Baotou Steel Union Co.Ltd(600010) was adjusted to 26887 yuan / ton excluding tax (dry volume, REO = 51%), up 65% year-on-year, an increase of 36 percentage points over the previous year. Affected by this, we calculate that the comprehensive cost of rare earth raw material products of the company will rise by 46%. The price increase of Q1 products fully absorbed the cost pressure. The company announced that the profit of Q1 in 22 years was expected to increase by 750 ~ 950 million yuan year-on-year, with an increase of 96.78% ~ 122.59%.
The application of rare earth has entered a new stage, and the output release growth rate is lower than that in the downstream: the energy-saving and efficient characteristics of rare earth have been newly developed and applied in the era of intelligence and electrification. The rapid development of downstream new energy vehicles, wind power, industrial Siasun Robot&Automation Co.Ltd(300024) , industrial motors and other fields will drive the further growth of the demand for rare earth permanent magnet materials. It is expected that the compound growth rate of downstream demand for rare earth permanent magnet is expected to remain at about 22% from 2022 to 2025. On the supply side, under the rare earth supply quota system, the growth rate of mining quota of China's mineral products and smelting separation products is expected to maintain an increase of about 20%, which is equivalent to the global output growth of only about 12%, showing an overall pattern of insufficient supply and demand. As a leader in light rare earth and a major global supplier, the company is expected to fully enjoy the high prosperity of downstream demand.
Investment suggestion: we expect the company's earnings per share from 2022 to 2024 to be 2.00 yuan, 2.48 yuan and 2.92 yuan respectively. The return on net assets was 35.7%, 33.7% and 31.1% respectively, and the buy-b rating was reiterated.
Risk tip: the growth rate of the downstream industry of rare earth permanent magnet was lower than expected, and the quota quota was higher than expected.
