\u3000\u3 Guocheng Mining Co.Ltd(000688) 786 Jiangxi Yuean Advanced Materials Co.Ltd(688786) )
Event: in 21 years, the company achieved revenue of 401 million yuan, yoy + 56.56%; Net profit attributable to parent company: 89 million yuan, yoy + 70.98%; Deduct 78 million yuan of net profit not attributable to parent company, yoy + 94.73%. Among them, the revenue in Q4 was 98 million yuan, yoy + 13.99% and – 23.93% month on month; The net profit attributable to the parent company was 23 million yuan, yoy + 30.10% and + 8.46% month on month.
Successfully resist the fluctuation of raw materials + shipping costs, optimize product structure and boost profits through technological transformation
At the sales end, the sales volume of carbonyl iron powder of the company was 2684 tons in 21 years, yoy + 71%; 2543 tons of soft magnetic powder, yoy + 91%; MIM feed 307 tons, yoy + 107%; It is mainly because the company’s production expansion and technological transformation match the strong demand of downstream. At the raw material end, the average price of sponge iron in 21 years is 4014 yuan / ton, yoy+17.79%; The average price of electrolytic cobalt is 384000 yuan / ton, yoy + 43.79%; On the cost side, the transportation fee is transferred from the sales expense to the operating cost accounting. In 21 years, the overseas revenue accounted for 19.66%, which superimposed the tight international shipping and higher transportation cost. Under the dual influence, the gross profit margin of some products (carbonyl iron powder and soft magnetic powder) weakened slightly, but the profitability of alloy powder (gross profit margin yoy + 12.13pct) boosted the comprehensive gross profit margin, and the cost rate continued to be optimized.
21 year comprehensive gross profit margin 37.35%, yoy + 1.51pct; The net interest rate is 22.90%, yoy + 2.35pct. At the end of product structure, the proportion of high value-added products and output increased. In 21, the revenue of soft magnetic powder accounted for 29.97%, yoy+4.7pct, and the profit side growth was significantly stronger than the revenue; At the same time, in the field of powder for ultra-fine inductors, the output rate is improved through process optimization, and the output of high additional products is steadily promoted.
The prosperity of the industry and product penetration resonate upward, and the development of two wheel powder driven platform
High external prosperity and domestic substitution drive the release of powder demand. In terms of carbonyl iron powder, benefiting from the improvement of automobile intelligence and integrated forming inductance permeability, the company has a strong demand for high value-added carbonyl iron soft magnetic. The company has mass produced 130 / 155 ℃ soft magnetic for automotive electronics, and the pre research of higher specification 180 ℃ has been completed. In terms of atomized alloy powder, structural parts and folding screen hinge are expected to open a new business cycle of MIM process. The company’s products have completed certification and are expected to be in large quantities in 22 years; In terms of functional parts, the demand for consumer electronics is stable, and the alloy soft magnetic particle core continues to benefit from the prosperity of optical storage and new energy.
Endogenous growth comes from underlying technology and capacity seeding. In terms of underlying technology, the company has two basic powder preparation processes and three deep-processing capabilities at the same time, which not only forms an integrated extension of high added value, but also drives the development advantage of platform. In terms of production capacity, the production capacity of carbonyl iron powder increased from 5500 tons to 11500 tons after reaching the production capacity; Meanwhile, the raised investment project will increase the capacity of 4000 tons of high-performance powder, including 2000 tons of soft magnetic powder for powder core, and continue to promote the growth of performance. Among them, the production capacity of carbonyl iron powder after reaching the production capacity is basically equal to that of BASF, the global leader; 2000 tons of soft magnetic powder for powder core is expected to be put into operation in H1 of 22 years, which is expected to open the new energy track of optical wind storage and realize the full coverage of soft magnetic products from electronics to electricity.
Investment suggestion: considering the company’s new business expansion, new product development, new process precipitation and new capacity release, the profitability is expected to be boosted. We raise the profit forecast and predict that the net profit attributable to the parent company in 20222024 will be 120 / 160 / 198 million yuan respectively (114 / 151 million before 22-23 years), corresponding to 27 / 20 / 16 times the current stock price and maintain the “buy” rating.
Risk tips: the risk of demand fluctuation, the risk of project construction falling short of expectations, the risk of raw material fluctuation, the risk of high customer concentration, the risk of unsustainable government subsidies, and the business risk of Sino US trade friction
