\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 99 Weihai Guangwei Composites Co.Ltd(300699) )
Event: on April 12, 2022, the company released its 2021 annual report: in 2021, the company realized a revenue of 2.607 billion yuan, an increase of 23.25% at the same time; The net profit attributable to the parent company was 758 million yuan, an increase of 18.18% at the same time; Deduct the net profit not attributable to the parent company of 713 million yuan, an increase of 25.95% at the same time.
Key investment points
Leading enterprises in the field of civil and military carbon fiber, with good profit quality. In 2021, the company achieved an income of 1.275 billion yuan, an increase of 18.32% year-on-year under the influence of multiple factors such as the price reduction of mass production and finalized carbon fiber, the rise of civil product prices and the increase of carbon fiber product varieties. Although the price of mass-produced and finalized carbon fiber products decreased during the reporting period, the company’s net profit attributable to the parent company and net profit deducted from non-profit maintained a stable growth, indicating the company’s high business stability and profit quality. The return on net assets of the company increased by 1.09 percentage points year-on-year, and the overall profitability increased steadily.
Downstream demand is strong and performance will continue to release. Lightweight and high-strength carbon fiber materials have excellent lightweight, emission reduction and environmental protection functions. They have obvious technical performance advantages and good development prospects in the application fields such as blade manufacturing in the field of wind power, Cecep Solar Energy Co.Ltd(000591) silicon wafer production of thermal field materials, storage and transportation equipment in the field of hydrogen energy. During the reporting period, the company’s new energy materials sector with wind power carbon beam as its main product achieved a revenue of 808million yuan, an increase of 12.56% year-on-year; The general new materials sector with prepreg as its main product seized the business opportunities in the field of wind power, successfully developed carbon fiber semi prepreg suitable for wind power blade manufacturing, realized mass production and applied to wind power blade manufacturing, and realized a revenue of 359 million yuan, with a year-on-year increase of 51.94%. Combined with strong downstream demand, the company’s performance is expected to continue to release.
The new project is completed and put into operation, which is expected to contribute to incremental profits. During the reporting period, the company completed the construction of the raised investment projects “high strength and high model carbon fiber industrialization project” and “military civilian integration high strength carbon fiber efficient preparation technology industrialization project”. At present, it has been put into operation and gradually began to increase in large quantities. Amorphous fibers have made the greatest contribution to performance growth, and achieved sales of 372 million yuan throughout the year, mainly including T700, T800 and high strength and high modulus MJ series fibers, T800 series products are the main materials for the next generation of aviation equipment, and are expected to contribute more incremental profits after mass production.
Profit forecast and investment rating: Based on the high prosperity of downstream application fields and considering the company’s leading position in military and civil carbon fiber fields, we expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 969 / 1256 / 1461 million respectively, corresponding to EPS of RMB 1.87, RMB 2.42 and RMB 2.82 respectively, and corresponding PE of 27 / 20 / 18 times respectively. It is covered for the first time and given a “buy” rating.
Risk tips: 1) downstream demand and order fluctuation; 2) The company’s profit is less than expected; 3) Market systemic risk.
