Power investment energy ( Huolinhe Opencut Coal Industry Corporation Limited Of Inner Mongolia(002128) )
The coal and aluminum industry continued its high boom, and the company’s annual performance was fully released. Maintain “buy” rating
The company released its 2021 annual report. In 2021, it achieved an operating revenue of 24.65 billion yuan, a year-on-year increase of 22.79%; The net profit attributable to the parent company was 3.56 billion yuan, a year-on-year increase of 71.92%. Benefiting from the rising prices of coal and aluminum, the production and sales of the company’s main businesses were stable, and the annual performance was fully released. We maintain the profit forecast for 20222023 and add the profit forecast for 2024. It is estimated that the net profit attributable to the parent company in 20222024 will be 5.99/63.3/6.45 billion yuan, a year-on-year increase of 68.1% / 5.8% / 1.8%; EPS is 3.11/3.30/3.35 yuan, corresponding to 5.5/5.2/5.2 times the current share price PE. The future performance of the company’s main coal and aluminum industry is expected to be released steadily, the installation of new energy has entered the accelerated layout stage, and is optimistic about the transformation and growth potential. Maintain the “buy” rating.
The price of coal and aluminum is running at a high level, and the profits of double main industries are increasing
Coal business: in 2021, the revenue reached 7.47 billion yuan, a year-on-year increase of + 13.5%. Production and sales remained stable, with an annual output of 45.98 million tons and a sales volume of 46.04 million tons, basically unchanged year-on-year. According to the annual report, the comprehensive selling price per ton of coal in 2021 was 162.3 yuan / ton, a year-on-year increase of + 13%; The comprehensive cost per ton of coal was 85.2 yuan / ton, a year-on-year increase of + 14.8%; The comprehensive gross profit per ton of coal was 77.1 yuan / ton, a year-on-year increase of + 11.1%. The sales of the company’s long-term coal association accounts for a relatively high proportion. With reference to the increase of the benchmark price of the long-term coal association from 535 yuan / ton to 675 yuan / ton, it will catalyze the full release of the company’s performance. Electrolytic aluminum business: in 2021, the revenue was 14.44 billion yuan, a year-on-year increase of + 28.89%; The output of electrolytic aluminum was 878700 tons, a year-on-year decrease of 3.82%; The sales volume was 880300 tons, a year-on-year decrease of 3.47%. According to the annual report, the comprehensive selling price per ton of aluminum in 2021 was 16400 yuan / ton, a year-on-year increase of + 33.5%; The comprehensive cost per ton of aluminum was 12124 yuan / ton, a year-on-year increase of + 22.8%; The comprehensive gross profit per ton of aluminum was 4276 yuan / ton, a year-on-year increase of + 77.4%. The company’s electrolytic aluminum pricing mechanism is flexible and fully benefits from the high elasticity of aluminum price. On the cost side, since the company provides its own coal power and coal, it can effectively avoid the cost pressure caused by the rise of energy prices. Overall, the company’s electrolytic aluminum business profits benefit at both ends of the price and cost or at the same time.
New energy installation projects continued to be launched, green power transformation accelerated, and opened a third growth curve
Power business: in 2021, the revenue was 2.27 billion yuan, a year-on-year increase of + 16.73%. Downstream demand remained strong, and power generation and sales increased steadily. The annual power generation reached 7.656 billion kwh, a year-on-year increase of + 10.6%; Electricity sales reached 6.889 billion kwh, a year-on-year increase of + 10.62%. According to the annual report, the selling price of kWh is 0.33 yuan / kWh, a year-on-year increase of + 5.52%; The cost of kwh electricity was 0.23 yuan / kWh, a year-on-year increase of + 6.04%; The gross profit of kwh electricity was 0.1 yuan / kWh, a year-on-year increase of + 4.4%. According to the company’s announcement in March, the company plans to invest in three new energy projects with a total installed capacity of 1.5gw: Tongliao 1 million kW wind power transmission project, Shanghai Miao Shandong UHV transmission channel Alxa base 400MW wind power project, and Jinzhong Yuci 100MW roof distributed photovoltaic project. According to the previous announcement, the first two have been approved at the end of 2019. Up to now, about 1.55gw of new energy units have been connected to the grid. In addition, the installed capacity of approved projects under construction is 2.35gw, and the planned projects to be approved are 2.08gw, totaling 5.98gw. Considering the short construction period of green power installation, the grid connected capacity is expected to increase intensively in 2022. Under the background of double carbon target, at present, it is in a critical period of energy reform, and it is the general trend for traditional energy enterprises to plan transformation. Backed by the state power investment group, a central enterprise leading in the installation of new energy, the company has a clear transformation direction, takes the lead in the layout of green power transformation, and has the advantage of first mover scale, which is expected to form the core competitiveness of high barriers in the medium and long term. Optimistic about the long-term performance power of the company’s green power transformation.
Risk tip: economic growth slows down; Coal and aluminum prices fell more than expected; The utilization rate of new energy units is lower than expected
