\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 096 Yunnan Yuntianhua Co.Ltd(600096) )
Event: on April 14, the company released the first quarterly report of 2022: in 2022q1, the operating revenue was 14.962 billion yuan, a year-on-year increase of 13.28%, the net profit attributable to the parent company was 1.646 billion yuan, a year-on-year increase of 186.15%, and the net profit deducted from non parent company was 1.593 billion yuan, a year-on-year increase of 224.63%.
Comments:
The boom of phosphate fertilizer + non fertilizer has risen, which has boosted the company’s performance. In 2022q1, the company realized a net profit attributable to the parent company of 1.646 billion yuan, a year-on-year increase of 186.15%, and a year-on-year increase of 224.63% after deducting non-profit. The substantial improvement of the company’s performance mainly benefited from the prosperity of its main business, with a gross profit margin of 18.64%, a year-on-year increase of 7.56pct and a net profit margin of 8.8%, a year-on-year increase of 7.8pct. Driven by cost support and short supply, the company’s fertilizer business boom has improved. According to Baichuan data, the average prices of the company’s main products monoammonium phosphate, diammonium phosphate, urea and compound fertilizer 2022q1 are 3079 yuan / ton, 3497 yuan / ton, 2657 yuan / ton and 3266 yuan / ton respectively, with a year-on-year increase of 41%, 30%, 33% and 42%. The profits of non fertilizer businesses such as polyoxymethylene, yellow phosphorus and feed grade calcium phosphate also increased significantly year-on-year. In addition, the operating performance of joint-stock companies has improved, and the investment income of the company has also increased year-on-year.
Mineralization integration, remarkable synergy and effective improvement of operation efficiency. The production capacity of “phosphate rock phosphoric acid” and synthetic ammonia of the company is highly self-sufficient and has strong integration advantages, which effectively alleviates the cost rise caused by the rise in the price of raw materials such as sulfur and coal, highlights the competitive advantage of chemical fertilizer products and realizes stable profits. In terms of period expenses, the period expense rate of 2022q1 company was 4.72%, a year-on-year decrease of 4.1pct. Among them, the sales expense rate was 1.1%, a year-on-year decrease of 3.12pct, the management expense (including R & D expenses, comparable caliber) rate was 1.76%, a year-on-year decrease of 0.65pct, and the financial expense rate was 1.86%, a year-on-year decrease of 0.33pct.
The demand of the downstream market increased rapidly, and the fertilizer boom continued to rise. In 2021, the general rise of major Shenzhen Agricultural Products Group Co.Ltd(000061) prices such as corn and wheat led to the recovery of the planting industry and continuously boosted the demand for chemical fertilizer. At the same time, the price of staple food was strong, boosting the prices of compound fertilizer and phosphate fertilizer. On the supply side, the phosphorus and compound fertilizer industry association requires that by 2025, the production capacity of 2.5 million tons of phosphate fertilizer will be eliminated and the total production capacity of the industry will be controlled below 20 million tons P2O5 / year. However, the high terminal Shenzhen Agricultural Products Group Co.Ltd(000061) demand and tight supply and demand push up the product price.
Relying on its unique advantages, build a new energy circle of friends. The company signed cooperation agreements with Yuxi Municipal People’s Government of Yunnan Province, Yunnan Energy New Material Co.Ltd(002812) , Eve Energy Co.Ltd(300014) , and Huayou holdings, and jointly established two companies in Yuxi City to build battery supporting projects such as new energy battery, lithium battery isolation film, iron phosphate, lithium iron phosphate and copper foil projects. The company holds 17% shares in both companies; The company also changed Xinjiang yunjutian 60000 T / a polyoxymethylene project to Tian’an chemical 100000 t / a iron phosphate project, which is expected to reach the expected usable state in August 2022; In addition, the company invested 1 billion yuan to establish a wholly-owned subsidiary Yunnan Yuntian energy new materials and build a 500000 ton iron phosphate project. The company has the capacity of phosphate ore, wet process phosphoric acid and industrial grade monoammonium phosphate, and continues to extend the industrial chain to the downstream, which helps to open up new growth space and thicken the company’s profits under the background of the rapid development of new energy vehicles.
Profit forecast and investment suggestion: assuming that the new production capacity of the company can be put into operation on schedule, the net profit attributable to the parent company in 20222024 is expected to be 5.047 billion yuan, 5.537 billion yuan and 6.005 billion yuan respectively, and the EPS is 2.75 yuan, 3.02 yuan and 3.27 yuan respectively. We selected Xinyangfeng Agricultural Technology Co.Ltd(000902) , Chengdu Wintrue Holding Co.Ltd(002539) , Sichuan Development Lomon Co.Ltd(002312) , Anhui Sierte Fertilizer Industry Ltd.Company(002538) as comparable companies in the field of chemical fertilizer, The average PE of comparable companies in 2022 and 2023 is 16.07 times and 13.92 times (corresponding to the closing price on April 15, 2022), and the current share price is 10.11 times and 9.22 times corresponding to the PE of the company in 2022 and 2023, respectively. We believe that the new energy business is expected to further open the company’s growth space and give a “buy” rating.
Risk warning: the downstream demand is less than the expected risk; The new project is less than the expected risk; Safety and environmental protection risks; The data information on which it is based lags behind the risk.
