\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 99 Weihai Guangwei Composites Co.Ltd(300699) )
Event: the company recently released 2021 annual report and 22q1 performance forecast. The annual revenue in 2021 was 2.61 billion yuan, yoy + 23.3%; Net profit attributable to parent company: 760 million yuan, yoy + 18.2%; Deduct non net profit of 710 million yuan, yoy + 26.0%, which is basically consistent with the performance express data. The annual performance is slightly lower than the market expectation. We believe that it is mainly caused by factors such as price reduction of some products and tight supply of raw materials. In 2022q1, the revenue is expected to reach 590 million yuan, a year-on-year decrease of about 5%; The net profit attributable to the parent company was 207 million yuan, a year-on-year decrease of 5.37%.
The quarterly revenue is relatively balanced; Gross profit margin has declined. In a single quarter, 2021q1 ~ Q4: 1) the revenue is 620 million yuan, 660 million yuan, 680 million yuan and 640 million yuan, which is relatively balanced; 2) The net profit attributable to the parent company is 220 million yuan, 220 million yuan, 180 million yuan and 140 million yuan. Quarterly profit is high before and low after. 3) The annual comprehensive gross profit margin was 44.4%, a year-on-year decrease of 5.4ppt, the lowest level since 2014; The net interest rate was 29.0%, a year-on-year decrease of 1.3ppt. The profit margin of the company decreased in the second half of the year, which may be due to the decline in the price of some products, the increase in the proportion of products with low added value and the rise in the price of some raw materials. These factors will be greatly improved in 2022.
Multiple models of products were successfully delivered in batch production, and the capacity under construction was gradually implemented. In terms of products, 1) the revenue of carbon fiber and fabric is 1.28 billion yuan, yoy + 18.3%, accounting for 48.9% of the total revenue. Among them, amorphous carbon fiber contributes more than 70% to performance growth; The successful batch production and delivery of MJ series products marks the successful localization of key models of high-strength and high modulus products in China; 2) The revenue of carbon beam is 810 million yuan, yoy + 12.6%, accounting for 31.0% of the total revenue; 3) Prepreg revenue was 360 million yuan, yoy + 51.9%. This business grew rapidly, mainly due to the expansion of applications such as wind power blades and aerospace. 4) The company actively promoted capacity expansion, added 10 carbon beam production lines with a total annual output of 1.7 million meters in 2021, and continued to expand production; Inner Mongolia Guangwei project is expected to have a capacity of 4000 tons and put into operation in 2022. The company’s capacity under construction is gradually implemented to prepare for the large-scale demand of downstream.
Improved cost control capability; In the future, R & D will be inclined to downstream application products. In 2021, the company’s annual expense rate decreased by 5.3ppt to 13.6% year-on-year, of which the R & D expense rate was 8.9%, with a year-on-year decrease of 4.1ppt, mainly due to the basic completion of the development of t800h project and the conclusion of M40J project. The R & D cost is 232 million yuan, and the absolute amount is still high. With the maturity of raw materials, the company’s future R & D investment will gradually transfer to downstream application end products. By the end of 2021, the company had: 1) receivables of 440 million yuan, an increase of 62.9% over the beginning of the year, which was due to the increase of civil products business income; 2) The advance payment was 40 million yuan, a decrease of 31.3% over the beginning of the year; 3) The inventory was 410 million yuan, an increase of 43.9% over the beginning of the year, which was due to the increase of production materials and finished products; 4) Contract liabilities amounted to 30 million yuan, an increase of 4.4% over the beginning of the year; 5) The net cash flow from operating activities was 1.2 billion yuan, an increase of 25.2% year-on-year.
Investment suggestion: the company is the leader of carbon fiber in China, and its products cover many fields such as downstream special applications and industry. We expect that the operating pressure of the company in 2022 will continue to ease compared with 2021. We expect the net profit attributable to the parent company from 2022 to 2024 to be 1.03 billion yuan, 1.34 billion yuan and 1.72 billion yuan respectively. The current share price corresponds to PE of 25X / 19x / 15x from 2022 to 2024. Considering the continuous high prosperity of the downstream industry and the leading position of the company, we give the company 30 times PE in 2022, and the EPS in 2022 is 1.98 yuan / share, corresponding to the target price of 59.41 yuan. Maintain a “recommended” rating.
Risk warning: price fluctuation of raw materials; The progress of new products is less than expected; The epidemic affects production, etc
