\u3000\u3 China Vanke Co.Ltd(000002) 001 Zhejiang Nhu Company Ltd(002001) )
The company released its 2021 annual report, realizing an operating revenue of 14.798 billion yuan, a year-on-year increase of 43.47%, and a net profit attributable to the parent company of 4.324 billion yuan, a year-on-year increase of 21.34%; Net profit deducted from non parent company was 4.148 billion, with a year-on-year increase of 21.63%. Several projects under construction are expected to be put into operation one after another, contributing to growth and maintaining the buy rating.
Key points supporting rating
The performance is in line with expectations: the company achieved an operating revenue of 14.798 billion yuan in 2021, a year-on-year increase of 43.47%; The net profit attributable to shareholders of listed companies was 4.324 billion yuan, a year-on-year increase of 21.34%, and the net profit after deducting non recurring profits and losses was 4.148 billion yuan, a year-on-year increase of 21.63%. In the fourth quarter, the operating revenue in a single quarter was 4.282 billion yuan, a year-on-year increase of 50.72%, the net profit attributable to the parent was 958 million yuan, a year-on-year increase of 52.50%, and the net profit attributable to the parent after deduction was 946 million yuan, a year-on-year increase of 55.34%. In 2021, the company’s nutrition business realized a revenue of 11.128 billion yuan, a year-on-year increase of 55.59% and a gross profit margin of 47.04%; Flavor and fragrance business achieved revenue of 2 billion 239 million yuan, an increase of 14.47% over the same period, and a gross margin of 42.13%. The revenue of new materials business was 874 million yuan, a year-on-year increase of 20.94%.
The price of vitamin E rose year-on-year, and the commissioning of vitamin B6 and vitamin B12 projects was progressing smoothly. In terms of product price, according to wind statistics, in 2021, the average prices of vitamin A (500000 IU / g), vitamin E (50%) and methionine (domestic: 25kg / piece) decreased by 19.91%, 24.00% and 2.47% respectively year-on-year, and the average prices in the fourth quarter increased by 1.12%, 13.43% and 11.50% respectively compared with the third quarter. In terms of product production and marketing, in 2021, the company’s methionine production line of 50000 tons in phase I achieved full capacity production, and the 250000 tons / year project in phase II, including 100000 tons device and biological fermentation project (phase I) continued stable production. In addition, according to the company’s previous interactive Q & A with Shenzhen Stock Exchange, the construction of 6000 tons of vitamin B6 in TMB project of Shandong Industrial Park and 3000 tons of vitamin B12 in phase II of Heilongjiang biological fermentation project have been completed, and the commissioning is progressing smoothly.
Breaking through many high barrier products and leading the fine chemical industry continuously: over the years, with the advantage of industrial chain and technology, the company has broken through the production and sales of high barrier products such as essence, perfume, methionine and PPS/PPA, and all business sectors have achieved good synergy. Since 2018, the company has started the construction of a number of new projects, including 250000 tons of methionine, Heilongjiang biological fermentation, Shandong nutrition and fine chemical project, Shangyu Industrial Park PPS project, Karon anhydride and aza double ring project, Shandong new energy materials and environmental protection new materials project, etc. this part of production capacity is expected to be put into operation successively from 2022 to 2024, release performance, and the company’s revenue scale is expected to continue to increase.
Valuation
Affected by the continuous release of the capacity of projects under construction, the profit forecast is raised. It is expected that the earnings per share in 20222024 will be 2.01 yuan, 2.54 yuan and 2.85 yuan respectively, and the corresponding PE will be 15.8 times, 12.5 times and 11.2 times respectively. Optimistic about the company’s continued growth and maintain the buy rating.
Main risks of rating
The commissioning progress of new projects such as Heilongjiang biological fermentation phase II and Caron anhydride and aza double ring project was later than expected. Downstream demand was significantly lower than expected. Product prices fell sharply.
