\u3000\u30 Shenzhen Fountain Corporation(000005) 81 Weifu High-Technology Group Co.Ltd(000581) )
Matters:
The company disclosed in its 2021 annual report: the operating revenue increased by 6% year-on-year to 13.7 billion yuan, the net profit decreased by 7% year-on-year to 2.6 billion yuan, and the deduction of non net profit increased by 22% year-on-year to 2.5 billion yuan. The distribution plan is as follows: take 1008603293 shares as the base, distribute cash dividends of 16 yuan (including tax) to all shareholders for every 10 shares, do not give bonus shares, and do not increase share capital with accumulation fund.
Ping An View:
The expenses decreased significantly and the net profit of consolidated business increased. After deducting the non net profit from the consolidated statements in 2021 and excluding the investment income, it was 590 million, a significant increase year-on-year. It is mainly due to the sharp decline of various expenses, of which the sales expenses decreased by 35%, mainly due to the decrease of three guarantees. Management expenses decreased by 22%, mainly due to the high base caused by the withdrawal of incentive funds in the same period in 2020.
In 2021, the revenue from sales to Bosch increased by 14% year-on-year, and the company’s comprehensive gross profit margin decreased. The commercial vehicle market weakened in the second half of 2021 due to the switching of national six emission regulations for heavy diesel vehicles and the wait-and-see consumption brought by the “blue light truck” policy. In 2021, commercial vehicle production fell by 11% and truck production fell by 13%. From the perspective of the three main businesses, the gross profit margin of the fuel injection system fell to 24.5%, and the revenue increased by 12.3% to 6 billion, of which the supply to Bosch increased by 14% year-on-year to 4.36 billion (equivalent to 72.4% of the revenue of the fuel injection system). The annual sales of 2.1 million common rail pumps reached a record high. The company’s revenue from sales to Bosch gasoline diesel and Germany Bosch is equivalent to about 28% of the current revenue of Bosch gasoline diesel. In 2021, the operating profit of the tail gas treatment system increased to 700 million, with a gross profit margin of 10.7%. Weifulida achieved a net profit of 340 million (250 million in 2020). In 2021, the sales volume of gasoline purifiers was nearly 2.2 million (2 million in 2020), and the annual sales volume of diesel purifiers was nearly 320000 (500000 in 2020). The market share of passenger cars increased steadily, realizing a breakthrough in the high-end independent passenger car market. The reason for the better year-on-year growth of Weifu Lida’s net profit is that the investment income of Weifu environmental protection, a joint-stock enterprise, increased year-on-year. The gross profit margin of the intake system dropped to 28.4% in 2021, and the revenue was flat and slightly reduced to 650 million. The annual sales volume of four cylinder supercharger exceeded 750000, a record high. The market share of four cylinder diesel engine remained the first in China. Gasoline engine obtained several key projects from customers, while six cylinder supercharger maintained the leading position of several key customers and obtained natural gas and diesel projects from many mainstream customers.
In 2021, the company’s investment income was 2 billion, accounting for 71% of the company’s total profit. Among them, Bosch gasoline and diesel contributed 1.1 billion, a slight decrease year-on-year; Zoomlion electronics contributed 340 million, higher than 310 million in 2020. In 2021, the revenue of Bosch gasoline and diesel decreased slightly to 15.7 billion year-on-year, and the net interest rate was 20.6% (the net interest rate was more than 22% from 2017 to 2020).
As a supplier of core components in the diesel engine industry chain, the company’s industry position will continue to improve. On July 1, 2021, the national VI emission standard will be fully implemented for heavy diesel vehicles, and the National IV emission standard for non road diesel machinery is expected to be implemented by the end of 2022. At present, some cities have encouraged the elimination of national four diesel vehicles. Bosch gasoline diesel, as a supplier of core components of diesel engine, will continue to benefit, and Weifu High-Technology Group Co.Ltd(000581) main business will also benefit.
Actively promote the strategic planning of fuel cells and core components of intelligent network. In recent years, the company has carried out key strategic layout in the fields of green hydrogen energy and intelligent electric power, established the Research Institute of new energy and networking technology, and built the hydrogen fuel cell test center, forming the technical R & D capacity of core components of hydrogen fuel cell and intelligent networking products. The core components of fuel cell include “one membrane and two sectors” (membrane electrode, graphite bipolar sector, metal bipolar sector) and BOP key components, which are matched for fuel cell stack and system manufacturers outside China. In 2021, the company realized the sales revenue of hydrogen fuel cell core parts and electric drive core parts of about 90 million yuan, and the business volume is still small.
Profit forecast and investment suggestions: truck production is expected to decline in 2022, and medium and heavy truck sales are expected to decline by about 26%. Non road implementation country IV will continue to bring performance increment. According to the latest situation, we updated the company’s net profit forecast for 2022 / 2023 to 2.469 billion / 2.767 billion (the original net profit forecast for 2022 / 2023 was 3.167 billion / 3.454 billion), and the new company’s net profit forecast for 2024 was 2.96 billion. As the core supplier of diesel engine industry chain, the leading position of the company continues to improve. The new business layout is expected to bring the company’s long-term performance increment and maintain the company’s “recommended” rating.
Risk tips: 1) affected by covid-19 epidemic, the macroeconomic and market environment is still complex and severe, and the industry will still face great pressure. If the industry demand drops, it will have a certain impact on the company’s production and operation and profitability. 2) The company’s main raw materials include various grades of steel, aluminum and precious metals. The continuous rise of their prices will bring the risk of rising costs to the company. 3) With the continuous expansion of the company’s business scope, especially in the field of new energy, the management span is large, and there are potential business management and investment risks. 4) The investment in new business has increased and the income is still small.
