\u3000\u3 Shengda Resources Co.Ltd(000603) 650 Red Avenue New Materials Group Co.Ltd(603650) )
Red Avenue New Materials Group Co.Ltd(603650) issue the 2021 annual report. The annual revenue of the company was 2.308 billion yuan, yoy + 12.83%, and the net profit attributable to the parent company was 327 million yuan, yoy-20.44%. In the fourth quarter alone, the revenue was 594 million yuan, yoy + 8.9%, QoQ + 9.6%, and the net profit attributable to the parent company was 51 million yuan, yoy-37.7%, QoQ + 30.0%.
In terms of semiconductor photoresist, the company’s revenue in 2021 was 115 million yuan, yoy + 28.8%, of which the revenue of g / I line increased by 50.2% year-on-year, and the market share of g line reached 60%; The revenue of K glue increased by 265.8% year-on-year. K glue and line I have supplied 13 12 inch customers and 17 8-inch customers in batch (5 / 10 in 20 years respectively). In 2021, 21 new products were verified by customers and received orders, including 10 K adhesives, 9 I wires, and 2 photoresists for LED and advanced packaging. In terms of panel photoresist, Beixu’s annual revenue was 256 million yuan, yoy + 22.7%, sales volume was yoy + 21%, accounting for about 19% of the Chinese market. At the same time, the verification effect of high-performance new products in BOE was positive. It is expected to achieve mass production and sales in 2022, and further increase the proportion of downstream major customers. The annual revenue of the automobile / tire special materials business company was 2.167 billion yuan, yoy + 5.9%. Affected by the overseas epidemic, the gross profit margin was under pressure, down 6.3% to 24.9% year-on-year.
With continuous R & D investment, patents in the electronic field have increased rapidly. In 2021, the number of patents applied by the company in the electronic field reached 93 (13 in 20 years), and 37 (4 in 20 years) were authorized, with a rapid growth. For photoresist, electronic phenolic and other products, the company has made active layout. By the end of 21, the company had applied for about 40 patents in the field of photoresist and electronic phenolic and obtained 9 authorizations.
The upstream has been extended, and the R & D strength and profitability have increased simultaneously. At present, the company actively arranges the upstream of photoresist (IC + panel). The bottom-up industrial chain integration will not only greatly improve the company’s photoresist R & D strength, but also improve the company’s profit level and achieve a breakthrough in neck materials, but also make a huge profit. Electronic materials, degradable materials, and automotive / tire special materials, Red Avenue New Materials Group Co.Ltd(603650) horizontally expand multiple categories within the professional scope, vertically integrate the upstream and downstream of the industrial chain, and have preliminarily realized the new material platform strategy.
Multiple businesses grow and expand simultaneously to create a platform goal. We repeat the growth of Xinyue chemical, the global chemical platform leader. Xinyue chemical adheres to the strategy of diversified development, product / sales / development Trinity, and using the most core technology to achieve the whole chain connection between upstream and downstream. At present, Red Avenue New Materials Group Co.Ltd(603650) also keeps pace with the three major businesses, and adheres to the upstream and downstream integration with Xinyue chemical, the horizontal and vertical expansion based on homologous technology, and there are genes for the upward backtracking of product terminals. Therefore, we believe that Red Avenue New Materials Group Co.Ltd(603650) is also expected to become a large platform manufacturer in China.
At present, the company has three business lines: rubber additives, PBAT and the most core electronic materials. Based on its core technology, the company has opened up the whole chain of upstream and downstream development and cooperated with the integration of team, direction, technology and resources. So far, in addition, the company continues to expand production, gradually release production capacity and reduce dimensionality, which has brought important growth support to the company. We expect that the company will realize a net profit attributable to the parent company of RMB 4.0/6.1/930 million in 2022, 2023 and 2024 respectively, corresponding to the current valuation of 45.8/30.5/19.8x, maintaining the “buy” rating.
Risk warning: the progress of new product R & D and customer introduction is less than expected, and the downstream demand is less than expected
