\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Core view
Event: the company announced that in the annual report of 2021, the annual operating revenue was 31.997 billion yuan, a year-on-year increase of 48.21%; The net profit attributable to the parent company was 2.957 billion yuan, a year-on-year increase of 51.39%. In the fourth quarter alone, the company achieved an operating revenue of 8.282 billion yuan, with a year-on-year and month on month growth of 39.19% and 4.81% respectively; The net profit attributable to the parent company was 189 million yuan, with a year-on-year and month on month decrease of 66.98% and 64.88% respectively.
Affected by import repression, rising coal prices and other factors, Q4's profitability fell to the bottom of history. 2021q1, Q2, Q3 and Q4 companies realized a net profit attributable to the parent company of 11.1/11.2/5.4/190 million yuan respectively, of which, the main business profit of 2021q1 company quickly increased to a record high level thanks to the cost driven superposition of supply and demand improvement brought by the upward price of wood pulp at the beginning of the year; Since mid April 2021, the import of cultural paper supply side has increased to suppress the price. Since August 2021, the coal price has risen sharply, raising the energy cost. In the second half of the year, the profit of the company's pulp and paper business is under pressure as a whole. The net profit attributable to the parent company in a single quarter fell to the historical bottom in 2021q4. The annual roe and net interest rate in a single quarter of 2021q4 reached 4.0% and 2.3% respectively, and the profitability is also at the historical bottom. However, in 2021q4, when the energy cost rises rapidly and the profits of some listed paper enterprises have suffered losses, the company can still achieve performance better than the average profitability of the industry. The alpha built by the company relying on the cost advantage is continuously verified at the statement end.
In the second half of 2021, the gross profit margin of cultural paper dropped significantly to the bottom of history, and the profits of kraft linerboard and dissolved pulp remained above the historical median level. Split the revenue and gross profit structure of 2021h2 company, and kraft linerboard, dissolved pulp and cultural paper are still the top three sources of profit contribution. The gross profit margin of 2021h2 cultural paper fell significantly to the historical bottom month on month, while the gross profit margin of kraft liner paper and dissolved pulp maintained above the historical median level, partially offsetting the decline in the profitability of cultural paper in the same period. Among them, in 2021, the profit of cultural paper showed a trend of high before and low after, and the import and export factors constituted the main reason for price repression; The continuous rise in the price of foreign waste led to the decline in the profit per ton of carton board in the second half of the year, which is still at the historical median level; The price trend of dissolved pulp is relatively consistent with that of pulp, and the profit is above the historical median.
Since the beginning of 2022, the fundamentals have been repaired steadily upward from the bottom and can be improved quarterly. Affected by the UPM strike in Finland and the high price of paper in Europe, the margin of imported paper in China has decreased recently, the export of domestic paper has also increased, driven by the improvement of supply and demand and the increase of superimposed cost. Since the end of February, the market price of cultural paper has increased by Shenzhen Jt Automation Equipment Co.Ltd(300400) yuan / ton. Considering the continuous extension of overseas strike time and the obstruction of logistics, it is still possible to further increase the price in the small peak season in spring (March may 2022). In the medium and long term, the strategic layout of the company's three bases in Shandong, Guangxi and Beihai has been formed and has sufficient growth.
Profit forecast and investment suggestions
Appropriately raise the assumptions of pulp price and energy cost. According to the conservative situation, it is predicted that the net profit attributable to the parent company from 2022 to 2024 will reach 3.013/31.40/3.740 billion yuan (previously predicted to be 3.085/3.229 billion yuan from 2022 to 2023), the corresponding BPS will be 8.37/9.53/10.93 yuan respectively, and the roe will reach 14.6% / 13.1% / 13.6%. In combination with the Pb valuation range corresponding to the historical roe, the target valuation of 2022 is 1.9 times Pb, corresponding to the target price of 15.90 yuan, maintaining the "buy" rating.
Risk tips
Economic growth slowed down and terminal demand fell faster than expected; The company's new pulp and paper project fails to meet the expected risk
