\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Event: on April 16, Shandong Sun Paper Co.Ltd(002078) issued the annual report for 2021. In 2021 Shandong Sun Paper Co.Ltd(002078) achieved an operating revenue of 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%; The net profit attributable to the parent company after deduction was 2.932 billion yuan, a year-on-year increase of 52.44%. Among them, 2021q4 company achieved an operating revenue of 8.282 billion yuan, a year-on-year increase of 39.19%; The net profit attributable to the parent company was 189 million yuan, a year-on-year decrease of 66.98%; The net profit attributable to the parent company after deduction was 211 million yuan, a year-on-year decrease of 64.62%.
21q4 performance stage is under pressure, and the profits of box board paper and dissolved pulp are relatively good
The company has steadily promoted the construction of new projects, continued to strengthen the adjustment of product structure and raw material structure, continued to carry out R & D and innovation, and continued to implement the marketing strategy of product differentiation competition. In terms of products, in 2021, the company’s uncoated cultural paper, coated paper, dissolved pulp, household paper, coated base paper and kraft linerboard achieved revenue of RMB 8.671 billion, 40.99 billion, 32.55 billion, 857 million, 16.10 billion and 9.870 billion respectively, with a year-on-year increase of 20.29%, 16.80%, 49.46%, 9.01%, 94.98% and 136.59%, accounting for 27.10%, 12.81%, 10.17%, 2.68%, 5.03% and 30.85% respectively. With the launch of 450000 tons of new production capacity of cultural paper and box board corrugated paper in Shandong and Laos, the sales volume of paper products and pulp of the company increased by 37.63% and 10.31% year-on-year to 5.23 million tons and 1.07 million tons respectively. 21q4’s performance is under periodic pressure, mainly due to the pressure on the profitability of cultural paper. On the one hand, we expect that the double reduction policy affects domestic demand and the cost pressure is difficult to be transmitted smoothly. On the other hand, it is due to the sharp rise in coal costs in the fourth quarter. The average price of 21q4 thermal coal (q5500, made in Shanxi) rose by more than 200 yuan / ton month on month; The profitability of carton board paper and dissolved pulp maintained a relatively good level.
The increase of pulp and paper month on month is good, the profit is improved quarter by quarter, and the steady expansion of production capacity promotes the medium and long-term growth. Up to now, the price of wood pulp has continued to rise, and the prices of double offset paper, coated paper and dissolved pulp have increased by 450, 300 and 1500 yuan / ton respectively compared with the beginning of 2022, which is expected to promote the significant increase of 22q1 performance month on month. The subsequent wood pulp price is expected to remain high, superimposed with the high prosperity of paper export, which is expected to be beneficial to the further improvement of the company’s profit.
The company’s production capacity has expanded steadily, and the high proportion of wood pulp has brought profit stability. In the second half of 2021, the 550000 T / a cultural paper, 120000 T / a household paper, 800000 T / a chemical wood pulp and 200000 t / a chemical mechanical pulp projects of the company’s Guangxi Forest Pulp and paper project were successively put into operation, and the production capacity was gradually released, which is expected to contribute to the performance increment. In addition, the company plans to build a 5.25 million ton Forest Pulp paper integration project in Nanning, and further improve the strategic layout of Shandong Laos Guangxi base. The proportion of self prepared pulp with more than 55% will also promote the steady growth of profits under the background of the continuous rise of wood pulp prices.
Investment suggestion: with the continuous layout of the company’s Forest Pulp and paper base and the steady expansion of production capacity, the company’s medium and long-term growth can be expected. We estimate that the operating revenue of Shandong Sun Paper Co.Ltd(002078) 20222024 will be 36.543 billion yuan, 37.861 billion yuan and 38.775 billion yuan, with a year-on-year increase of 14.21%, 3.61% and 2.41%; The net profit attributable to the parent company was RMB 2.950 billion, RMB 3.121 billion and RMB 3.237 billion, with a year-on-year increase of – 0.23%, 5.79% and 3.73%. The corresponding PE was 10.9x, 10.3x and 10.0x, and the investment rating of Buy-A was given.
Risk warning: the downstream demand continues to be lower than the expected risk, and the price of raw materials fluctuates sharply
