\u3000\u3 China Vanke Co.Ltd(000002) 391 Jiangsu Changqing Agrochemical Co.Ltd(002391) )
Event: on the evening of April 18, the company released the annual report of 2021 and the first quarterly report of 2022. The company achieved an operating revenue of 3.765 billion yuan in 2021, an increase of 25.15% year-on-year; The net profit attributable to the parent company was 249 million yuan, a year-on-year increase of 27.48%. In 2021, Q4 company achieved an operating revenue of 1.164 billion yuan, a year-on-year increase of + 65.57% and a month on month increase of + 54.04%; The net profit attributable to the parent company was 13 million yuan, turning losses into profits year-on-year, with a month on month ratio of – 82.53%. In 2022, Q1 company achieved an operating revenue of 914 million yuan, a year-on-year increase of + 24.30% and a month on month increase of – 21.53%; The net profit attributable to the parent company was 80 million yuan, with a year-on-year increase of + 41.49% and a month on month increase of + 529.12%.
The capacity utilization rate was significantly improved, which promoted the growth of the company’s performance. Benefiting from the obvious improvement of the capacity utilization of the company’s original drugs and preparations, the company’s product sales increased significantly in 2021, which promoted the growth of the company’s performance. In 2021, the company’s production of pesticide technical drugs was 18300 tons, a year-on-year increase of + 17.7%; The sales volume was 19900 tons, a year-on-year increase of + 39.8%. The production of the company’s preparation products was 11000 tons, a year-on-year increase of + 8.4%; The sales volume was 11700 tons, a year-on-year increase of + 17.4%. At the same time, the average price of the company’s original drug products in 2021 was 117500 yuan / ton, a year-on-year increase of + 1.5%, and the price of preparations was 45900 yuan / ton, a year-on-year increase of + 2.2%. In terms of breakdown products, according to the data of Baichuan Yingfu, the average prices of dicamba, imidacloprid and sulfamethoxate in 2021 (from the beginning of the year to the end of the year) changed by – 4.7%, + 45.3% and + 8.2% respectively year-on-year; In 2022, the average prices of dicamba, imidacloprid and sulfamethoxate in Q1 changed by + 1.1%, + 75.0% and + 43.3% respectively year-on-year. In addition, under the sharp fluctuation of raw material costs, the company focused on market demand and flexibly formulated sales strategies, so that the gross profit margin of relevant businesses of the company remained relatively stable. Capacity planning has been steadily promoted to enhance the company’s production capacity. By the end of 2021, the company has a production capacity of 22060 tons / year of technical drugs and 13000 tons / year of preparations. Among them, there are 4400 tons / year of sulfamethoxate, 3000 tons / year of imidacloprid, 11000 tons / year of dicamba and 600 tons / year of Tricyclazole. In addition, the company’s capacity planning is also progressing steadily. The 2000 ton 2,6-diisopropylaniline project and the 2000 ton Kungfu pyrethrin technical drug project have been put into trial production. The 600 ton flufenitrile technical drug project has entered the pressure test and leakage test stage. The 3000 ton thiamethoxam technical drug project is in the equipment installation stage. The raised investment project has also been steadily promoting the annual output of 1000 tons bifenthrin technical drug and 3500 tons glyphosate technical drug. At the same time, the company will continue to expand its production capacity in Yichang production base. The second phase of the planned project with an annual output of 16500 tons of pesticide technical drugs and 20000 tons of chemical products was approved by the EIA in July 2021, and the company’s production capacity will be further improved in the future.
Profit forecast, valuation and rating: as the price of raw materials is still high, the company’s performance in 2021 is slightly lower than expected. Considering the rhythm of the company’s subsequent capacity planning and the trend of product prices and costs, we lowered the company’s 22-year profit forecast, raised the 23-year profit forecast, and added a 24-year profit forecast. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 3.70 (down 8.4%) / 5.11 (up 7.8%) / 629 million yuan respectively. We are still optimistic about the performance growth after the company’s new capacity is put into operation one after another, and maintain the company’s “overweight” rating.
Risk tip: price fluctuation of pesticides and raw materials, environmental protection and safety production risks, and production capacity release is less than expected.
