\u3000\u3 China Vanke Co.Ltd(000002) 001 Zhejiang Nhu Company Ltd(002001) )
Performance review
The company released its annual report on April 14, 2022, in which the operating revenue was 14.798 billion yuan, a year-on-year increase of 43.47%, and the net profit attributable to the parent was 4.324 billion yuan, a year-on-year increase of 21.34%.
Business analysis
As the energy price difference between China and Europe expands, the VA, VE and methionine markets are expected to be further transferred to China: Europe is the main production area of VA, VE and methionine. Benefiting from the expansion of energy price difference between China and Europe, the cost advantage of China’s related products will be more prominent. We believe that these products are expected to gradually seize the European market share.
The performance in 2021 was in line with expectations, and the market price of main products increased slightly: during the reporting period, the net profit attributable to the parent company was 2.324 billion yuan, and the performance was in line with our expectations. In terms of price, the price of the company’s main nutritional products increased slightly. In the fourth quarter of 2021, the average price of 500000 IU / g VA powder, 50% ve powder and methionine in the Chinese market was 286.17 yuan / kg, 89.42 yuan / kg and 20.97 yuan / kg respectively, with month on month changes of – 1.12%, 13.43% and 14.28% respectively.
“Chemical +” and “biological +” platforms are gradually taking shape, and the company can grow in the future: the company continues to optimize and consolidate the foundation of “chemical +” and “biological +” platforms by continuously enriching product categories, improving product quality and expanding product capacity. In the nutrition sector, the company has become one of the four major vitamin manufacturers in the world. By continuing to expand, refine and strengthen, it is expected to become a comprehensive solution provider of nutrition additives in the future; In addition, the company also actively deployed Frontier Biotechnologies Inc(688221) technology to create a “biological +” platform. During the reporting period, the company’s methionine phase II was 250000 tons / year, of which 100000 tons of units operated smoothly, the cost and quality advantages continued to improve, and 150000 tons of units were constructed according to the progress, and the overall process was controllable; In the essence and flavor sector, the company relies on two major platforms, namely, chemical synthesis and biological fermentation, to enrich the spice varieties and meet the changing market demand. The products cover many fields such as daily chemical, food and medicine. With the continuous introduction of new products, the business is expected to continue to grow steadily. At the same time, in the new material business, based on the polymerization process and downstream application research and development of high-performance resin, the company continues to expand and strengthen through high-efficiency, stable, energy-saving and environmental protection professional production.
Investment advice
As one of the leaders in China’s fine chemicals industry, the company has better industrial chain scalability and strong market position. The company raised its profit forecast for 2023 by 8.57%. We expect the net profit attributable to the parent company from 2022 to 2024 to be 4.621 billion yuan, 5.358 billion yuan and 5.958 billion yuan respectively, with corresponding EPS of 179, 208 and 231 respectively. 20 times PE in 2023 and target price of 41.6 yuan are given.
Risk tips
Falling product prices; The progress of the new project is less than expected; Declining demand
