\u3000\u3 China Vanke Co.Ltd(000002) 545 Qingdao East Steel Tower Stock Co.Ltd(002545) )
Event: the company released the performance express of 2021 and the performance forecast of the first quarter of 2022. In 2021, it is expected to achieve revenue of 2.782 billion yuan (year-on-year + 4.92%), net profit attributable to parent company of 404 million yuan (year-on-year + 30.77%), and net profit attributable to parent company of 185 ~ 225 million yuan (year-on-year + 292.36% ~ + 377.19%) in 22q1.
The double main industries are advancing steadily, and the production capacity of potash fertilizer is expected to increase: the company is mainly engaged in the double main industries of steel structure and potash fertilizer. In terms of steel structure business, the company is in the leading position in the subdivided fields, and its products are widely used in the basic industries of national economy such as electric power, radio and television, petrochemical, communication and construction. At the same time, the company continues to carry out the research and development of new series of steel structures, iron towers and supporting tooling equipment, In the future, it is expected to contribute to the improvement of the company’s comprehensive competitiveness. In terms of potash fertilizer, according to the announcement, the wholly-owned subsidiary Laos Kaiyuan Mining Co., Ltd. has 141 square kilometers of potash mining rights in Laos, including 41.69 square kilometers of the west section of Longhu mining area in Gambang Province, Laos. The mining area has retained resource reserves of 1.199 billion tons, 218 million tons of potassium chloride and rich mineral reserves, At present, it has a potassium chloride production capacity of 500000 tons / year, which is the largest existing potassium chloride production enterprise in Laos. In addition, according to the announcement, the “phase I project of 1.5 million tons of potassium chloride project (500000 tons) of potassium magnesium salt mine in Gambang Province, Laos” has been fully started on December 31, 2021. It is expected that the production capacity of Kaiyuan potassium chloride in Laos will be increased to 1 million tons / year by the end of 2022. With the gradual increase of potassium fertilizer production capacity in the future, The company is expected to benefit fully.
The prosperity of the potash fertilizer industry has improved, and the pioneer of the potash fertilizer strategy is expected to benefit: under the background of the gradual increase of global demand for Shenzhen Agricultural Products Group Co.Ltd(000061) in recent years, the global potash fertilizer price continues to rise. In addition, the recent continuous fermentation of the conflict between Russia and Ukraine has exacerbated the uncertainty of global potash supply. According to the Wall Street Journal and Argus, Russia and Belarus are the world’s second and third largest producers of potash respectively. The conflict between Russia and Ukraine has had a great impact on product transportation and local fertilizer export. At the same time, due to the sanctions of the European Union and the United States in recent years and the restrictions imposed on the transportation of Belarusian potash through Lithuania, the current supply of potash in Belarus also has great uncertainty. As a large country with a large population and agriculture, China has a great demand for fertilizer. However, at the same time, due to the relative lack of its own potassium salt resources, China is highly dependent on the import of potassium fertilizer. Therefore, it is necessary to adopt the methods of collecting and storing potassium fertilizer and supporting overseas potassium salt bases to ensure its own potassium fertilizer supply and food security. Southeast Asia, where the company’s potash business is located, is an area where Chinese enterprises have carried out overseas potassium search earlier. Laos Kaiyuan took the lead in feeding China back in 2014 and is a pioneer in responding to the national potash strategy. According to the announcement, the company currently has a production capacity of 500000 tons of potassium chloride per year. In addition, there are potassium fertilizer expansion projects under construction. According to the announcement, the production expansion project of 1 million tons will be completed in the next two to three years according to the situation. In the future, with the gradual increase of the company’s production capacity, the profitability is expected to be gradually improved.
Investment suggestion: we expect the net profit of the company from 2021 to 2023 to be 404 million yuan, 797 million yuan and 1.19 billion yuan respectively, and give a Buy-A investment rating.
Risk warning: the landing of projects under construction is not as expected; The macro environment is less than expected
