\u3000\u30 Shenzhen Quanxinhao Co.Ltd(000007) 89 Jiangxi Wannianqing Cement Co.Ltd(000789) )
The company released its annual report for 2021 on April 15, with annual revenue of 14.21 billion yuan, an increase of 13.4% at the same time; The net profit attributable to the parent company was 1.59 billion yuan, an increase of 7.6% at the same time; EPS2. 00 yuan / share.
Key points supporting rating
Q4’s revenue and net profit increased, and the operating cash flow decreased year-on-year: the revenue of 2021q4 company was 4.57 billion yuan, an increase of 23.9% at the same time; The net profit attributable to the parent company was 460 million yuan, an increase of 1.5% at the same time. In 2021, the net cash flow from operating activities of the company was 1.873 billion yuan, a decrease of 16.3%, mainly due to the increase in cash paid by the company for purchasing goods and receiving labor services in 2021 compared with the same period last year.
The comprehensive gross profit margin declined slightly or was dragged down by the gross profit margin of cement business: in 2021, the company’s comprehensive gross profit margin was 27.4%, with a decrease of 0.8pct, and the decline of cement business gross profit margin or the main reason for the decline of comprehensive gross profit margin; The gross profit margin of cement business in 2021 was 34.8%, with a decrease of 2.8pct, mainly due to the continuous rise of coal cost, resulting in high cost pressure. In 2021, the company’s expense ratio was 6.1%, a slight increase of 0.3pct year-on-year. The net interest rate attributable to the parent company is 11.2%, with a decrease of 0.6pct.
Jiangxi Province’s infrastructure investment is expected to boost the demand for cement in the province: Jiangxi Province will strive to complete more than 1 trillion yuan of investment every year from 2021 to 2023, including more than 200 / 50 billion yuan of major infrastructure projects / new infrastructure projects. In the 14th five year plan, Jiangxi Province proposed a total investment of 600 billion yuan in comprehensive transportation planning and construction, an increase of 151.9 billion yuan compared with the 13th Five Year Plan period. The development of infrastructure construction investment in Jiangxi Province is expected to further drive the improvement of cement demand in the province.
Valuation
Considering the uncertain factors brought to the cost by the fluctuation of coal price, we slightly adjust the company’s expectation. It is estimated that the company’s revenue from 2022 to 2024 will be 15.42 billion yuan, 16.67 billion yuan and 18.22 billion yuan; The net profit attributable to the parent company was 1.76 billion yuan, 1.87 billion yuan and 1.95 billion yuan respectively; EPS is 2.21, 2.35 and 2.45 yuan respectively. Maintain the company’s overweight rating.
Main risks of rating
The promotion of infrastructure and special bonds was less than expected, the supply and price stability of bulk commodities was less than expected, and the coordinated promotion in the region was weak.
