\u3000\u3 Shengda Resources Co.Ltd(000603) 916 Sobute New Materials Co.Ltd(603916) )
The company maintained steady growth, realized a net profit of 533 million yuan attributable to the parent company and maintained the “buy” rating
On April 15, the company released its annual report for 2021, achieving an operating revenue of 4.522 billion yuan, a year-on-year increase of + 23.81%, and a net profit attributable to the parent company of 533 million yuan, a year-on-year increase of + 20.88%. Against the background of sudden power and production restrictions and sharp fluctuations in raw material prices, the company has shown steady growth as always. We maintain 20222023 and add the profit forecast for 2024. We expect to realize the net profit attributable to the parent company of 725, 857 and 996 million yuan in 20222024, with the corresponding EPS of 1.73, 2.04 and 2.37 yuan / share respectively, and the current share price corresponding to PE of 13.8, 11.6 and 10.0 times respectively. We are optimistic that under the background of steady growth, infrastructure projects will be launched one after another. As a leader in the concrete admixture industry, the company’s capacity will be released simultaneously, which will fully benefit and maintain the “buy” rating.
In 2021, the net profit attributable to the parent company maintained a quarterly growth trend, and the annual operating cash flow performed well
Q4 company realized a net profit attributable to its parent company of 166 million yuan, with a year-on-year growth; In 2021, the company’s net profit attributable to the parent company maintained a quarterly growth, mainly due to the completion of the company’s Sichuan Daying base and its significant development effect in the southwest region. After the sharp rise in the price of raw material ethylene oxide from September to October 2021, Q4 company’s price increase effect is remarkable. According to the calculation of business data, the finished product price of Q4 high-performance water reducer is 2183 yuan / ton, an increase of 9.80% compared with Q3, making the gross profit margin of Q4 company return to 38.73%, an increase of 5.83pcts compared with Q3. In 2021, the company’s operating cash flow performed well. During the reporting period, the operating cash flow was 336 million yuan, a slight increase year-on-year. The company’s testing business grew rapidly, with a net profit attributable to the parent company of 142 million yuan in 2021, a year-on-year increase of 29.75% and a gross profit margin of 48.86%, which played a positive role in the coordinated development of the company’s business and the improvement of profitability. The company continued its high investment in R & D, with a R & D expense rate of 4.86%, a slight increase year-on-year.
Stable growth expectations are superimposed on the company’s production capacity. We are optimistic that the company is stable and upward and ready to go
According to the announcement, the company’s Guangdong Jiangmen base and Zhenjiang functional material base will gradually release production capacity from 2022 to 2023, while Jiangsu Lianyungang Port Co.Ltd(601008) base is expected to start production in 2024, and the company will maintain a high-speed growth trend under the leadership of two academicians. Under the background of steady growth in 2022, the company will fully benefit from the simultaneous production capacity investment and infrastructure development. In addition, as the leader of wind power grouting materials in China, the company is rising rapidly, which will help the rapid growth of functional materials business. We are firmly optimistic about the steady operation of the company and are ready to go.
Risk tip: the production capacity is less than expected, the downstream demand has fallen sharply, and the macro economy has declined.
