\u3000\u3000 Nbtm New Materials Group Co.Ltd(600114) (600114)
Event: on the evening of January 6, the company issued the announcement of performance reduction in 2021.
The performance in 2021 decreased by 66-100% year-on-year, mainly due to the fact that MIM business was less than expected and the provision of goodwill
The company expects that the net profit attributable to the parent company in 2021 will be about RMB 0-30 million, a year-on-year decrease of 66% – 100%, and the net profit attributable to the parent company after deduction of non profits will be RMB 51-26 million, a year-on-year decrease of 175% to 247%. The performance decline was mainly due to the impairment of goodwill caused by the lower than expected profitability of MIM related assets (Huajing + Fuchi). The total goodwill of Fuchi and Huajing is about 510 million. According to the preliminary financial calculation of the company, the amount of goodwill impairment reserve to be withdrawn in this period is about 65-85 million yuan.
Soft magnetic business (SMC) benefits from the development of photovoltaic and new energy vehicle industries, and is expected to enter the fast lane of development in the medium and long term
SMC business: in the first three quarters, the company increased the production capacity of soft magnetic materials in the field of photovoltaic and efficient household appliances, continuously developed soft magnetic materials products, continuously optimized the product structure, and the sales revenue of soft magnetic materials continued to grow rapidly. With the gradual return of raw material costs to normal and benefiting from the development of photovoltaic and new energy vehicle industries, the business revenue and performance are expected to enter the fast lane.
Marginal improvement of automotive chip supply; Expect the metal injection molding business (MIM) integration to be effective
PM business: according to the data of China Gas Association, from September to November 2021, automobile sales fell by 19%, 9% and 9% year-on-year, the decline was narrowed, and the chip supply trend was better as a whole; The hybrid trend of new energy vehicles is strengthened. In November, hybrid vehicles accounted for about 20% of new energy vehicles in the current month, an increase of 2 / 4 PCT compared with October / January. We believe that the 2021q4 chip supply problem is slowing down. Under the hybrid trend of new energy vehicles, the PM business is expected to maintain a good revenue growth.
MIM business: expect the integration to work gradually. It is expected that the operation of MIM business will not be substantially improved in 2021, mainly due to the decline of orders and the suspension of the project due to the profound changes in the international political and economic pattern and the shortage of chips. DSCC predicts that the global shipment of folding screen mobile phones is expected to climb to 17.5 million in 2022. At present, all mobile phone platforms have launched new folding screen mobile phones, and the outbreak year of folding screen mobile phones is expected to come. The company has become one of the qualified suppliers of 3C enterprises such as Xiaomi and oppo. In the medium and long term, MIM business is expected to benefit from the large volume of folding screen mobile phones. After collaborative integration, MIM business is expected to gradually increase in the automotive and medical fields, and MIM business is expected to have an inflection point.
Profit forecast: it is a leader in the field of equal material manufacturing. It is expected that the three businesses will cooperate, and it is expected to achieve 1 + 1 + 1 > 3 in the future
As a leader in the field of equal material manufacturing in China, the company’s PM / MIM / SMC three plates belong to the new material powder metallurgy manufacturing branch. With the further integration of the company, the technology, business and management of the three plates are further coordinated, and it is expected to achieve the operation effect of “1 + 1 + 1 > 3” in the future. Previously, three business reversal logics have been verified. Second: 1) PM revenue reversal; 2) SMC achieved high revenue growth; MIM business integration is poor in 2021, and it is expected that the performance will accelerate after the integration from 2022 to 2023. Due to the impairment of goodwill, the profit forecast for 2021-2023 is reduced. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 0.2/2.0/280 million respectively, with a year-on-year increase of – 74% / 750% / 41%, corresponding to pe295 / 35 / 25X. Maintain the company’s “buy” rating.
Risk tips
1) impairment of goodwill; 2) MIM business development is less than expected
