\u3000\u3 Guocheng Mining Co.Ltd(000688) 516 Wuxi Autowell Technology Co.Ltd(688516) )
In 2021, the revenue increased by 78.93% year-on-year, and the net profit attributable to the parent company increased by 138.63% year-on-year. The company achieved a revenue of 2.047 billion yuan in 2021, with a year-on-year increase of 78.93%; The net profit attributable to the parent company was 371 million yuan, with a year-on-year increase of 138.63%. The substantial increase in performance was mainly due to the sharp increase in product sales driven by the improvement of the photovoltaic industry. In 2021, the gross profit margin / net profit margin of the company was 37.66% / 17.95%, with a year-on-year increase of + 1.60 / + 4.37 PCT, and the profitability continued to improve, mainly due to the company’s leading photovoltaic equipment technology, continuous product renewal and iteration, and good cost rate control during the period. In 2021, the company’s sales / management / R & D / financial expense rate was 3.82% / 5.39% / 7.08% / 1.00%, with a year-on-year change of – 0.50 / – 0.99 / + 0.98 / + 0.22 PCT. the increase in R & D expense rate was mainly due to the company’s increased R & D investment, Due to the increase of R & D materials and personnel salary. The net operating cash flow of the company was 317 million yuan, with a year-on-year increase of 106.78%, and the payment collection was good.
The business of series welding machine has maintained rapid growth, and the breakthrough of single crystal furnace / lithium battery / semiconductor business has opened up new space. The company is a global leader in series welding of photovoltaic modules. Its business extends vertically to silicon wafer sorter, single crystal furnace, battery sintering and annealing furnace and other equipment, and horizontally to lithium battery module / pack production line and semiconductor bonding machine. In terms of business, the revenue of the company’s photovoltaic equipment / lithium battery equipment business in 2021 was RMB 1.725/96 billion respectively, with a year-on-year increase of 78.16% / 181.02%. Specifically, the sales volume of main grid series welding machines, the core photovoltaic product, was 1144 in 2021, with a year-on-year increase of + 72.81%, maintaining a high market share. In addition, new products continue to break through and open up more room for the company’s success: 1) photovoltaic single crystal furnace has made a breakthrough and obtained a batch order of 137 million yuan; 2) The integrated annealing furnace (optical injection) has obtained large orders and has been highly recognized by customers; 3) In 2021, the company’s lithium battery module / pack production line obtained honeycomb energy orders, and the amount of a single order exceeded 100 million yuan for the first time; 4) On April 6, 2022, the company obtained the order of Tongfu Microelectronics Co.Ltd(002156) sub batch aluminum wire bonding machine, marking that the company broke the import monopoly and entered the supply system of head sealing and testing plant. At present, the market scale of China’s bonding machine is about 5 billion yuan, mainly imported, and there is a wide space for domestic substitution. In 2021, the company’s bonding machine products have been tried out by many manufacturers. The first batch order obtained this time is expected to further drive the development of bonding machine business, and it is expected to further achieve a breakthrough in 2022.
There are sufficient orders on hand, and the future performance is expected to maintain high growth. In 2021, the company’s orders on hand were 4.256 billion yuan (including tax), a year-on-year increase of 77.41%, and the newly signed orders were 4.281 billion yuan (including tax), a year-on-year increase of 60.52%, of which 1.418 billion yuan was newly signed in 2021q4, accelerating the receipt of orders; The company has sufficient orders on hand, which will strongly support the rapid growth of performance in 2022.
Risk warning: the newly installed capacity of photovoltaic is less than expected; Industry competition intensifies; Raw material price fluctuation risk.
Investment suggestion: the company is the leader of photovoltaic series welding machine, with sufficient orders in hand to ensure high growth. The lithium battery and semiconductor business with multi-point layout has also made a breakthrough, which is expected to open up new growth space. We expect that the net profit attributable to the parent company in 202224 will be 524 / 685 / 896 million yuan, corresponding to pe38 / 29 / 22 times. It will be covered for the first time and given a “buy” rating.
