\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 989 Ningxia Baofeng Energy Group Co.Ltd(600989) )
Core view
Q1 performance in 2022 increased slightly year-on-year. In 2022, Q1 performance increased slightly month on month, and the price of main products remained high. In the first quarter of 2022, the company realized an operating revenue of 6.515 billion yuan, a year-on-year increase of 30.83%; The net profit attributable to the parent company was 1.746 billion yuan, with a year-on-year increase of 1.07% and a month on month decrease of 0.34% compared with the fourth quarter of 2021; Net profit deducted from non parent company was RMB 1.886 billion, with a year-on-year increase of 4.82% and a month on month increase of 4.31% in the fourth quarter of 2021. In the first quarter of 2022, the company achieved a gross profit margin of 38.97% and a net profit margin of 26.81%, up 9 PCT and 2.14 PCT respectively compared with the fourth quarter of 2021. This is mainly due to the rapid rise of international crude oil prices in the first quarter of 2022, the expansion of polyolefin price difference, the rebound of superimposed coke price, the sharp year-on-year increase of the company’s revenue and the slight year-on-year increase of net profit deducted from non parent company.
The high prices of coal and crude oil supported the high prices of main products. In the first quarter of 2022, the company’s coke output was 1.1698 million tons, and the average sales price was 225811 yuan / ton, up 31.54% year-on-year. The output of polyethylene and polypropylene was 183300 tons and 168900 tons respectively, and the average sales price was 767728 yuan / ton and 748876 yuan / ton respectively, with a year-on-year increase of 8.44% and a decrease of 0.34% respectively. The output of pure benzene, modified asphalt and MTBE were 20400 tons, 27400 tons and 24900 tons respectively, and the average sales prices were 653924 yuan / ton, 520886 yuan / ton and 631700 yuan / ton respectively, with significant year-on-year increases of 50.61%, 69.95% and 41.86% respectively. The company’s main products are strongly supported by the rise of coal and crude oil prices, and the sales price and sales revenue of each product have increased significantly year-on-year.
The Inner Mongolia project is waiting for the EIA, and the “14th five year plan” has long-term growth. The company’s 3 million T / a coking polygeneration project has been completed at the end of 2021 and will be put into operation. The 200000 t / a styrene project under construction will be completed and put into operation by the end of 2022. The 1 million T / a olefin project of Ningdong phase III is expected to be put into operation in the first half of 2023. At present, the construction progress of supporting EVA capacity has been more than half. The 500000 T / a coal to olefin project of Ningdong phase IV has been publicized and is expected to be completed during the 14th Five Year Plan period. The company’s phase I 2.6 million T / a coal to olefin project in Inner Mongolia has applied for EIA, and the construction can be started after the EIA is approved. As a benchmark enterprise of energy efficiency in the industry, the company has a high probability of passing the approval of the project. The overall planning of the company has a stable rhythm of project performance contribution and good long-term growth.
Risk warning: the risk of falling product price; The risk of tightening environmental protection and low-carbon policies such as dual control of energy consumption; Risk that the project is put into operation less than expected; The impact of sharp fluctuations in coal prices.
Investment suggestion: growth leading low-carbon coal chemical industry, maintain the “buy” rating. The company has outstanding advantages of low-cost coal to olefin, and the production rhythm of planned construction projects is clear. The gross profit margin of coking coal of the company is maintained at a high level under the background that the coal price is easy to rise but difficult to fall. We are optimistic about the steady long-term growth of the company during the 14th Five Year Plan period. It is estimated that the company’s net profit attributable to the parent company from 2022 to 2024 will be 8.212112.56/14.593 billion yuan, corresponding to EPS of 1.12/1.53/1.99 yuan, corresponding to the current share price PE of 14.4/10.5/8.1x, maintaining the “buy” rating.
