\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 18 Nanjing Hanrui Cobalt Co.Ltd(300618) )
The company released its 2021 annual report: in 2021, the company achieved a revenue of 4.35 billion yuan (+ 93.00%); Net profit attributable to parent company: 663 million yuan, (+ 98.25%); Deduct 694 million yuan (+ 268.94%) of net profit not attributable to parent company. In 2021q4, the company achieved a revenue of 1.146 billion yuan, an increase of 90.57% year-on-year and 1.96% month on month; The net profit attributable to the parent company was 177 million yuan, with a year-on-year increase of 2.63% and a month on month increase of 35.56%; Net profit deducted from non parent company was 151 million yuan, with a year-on-year increase of 256.45% and a month on month decrease of 0.46%.
The volume and price of copper and cobalt increased simultaneously, and the company’s performance increased significantly. By product: in 2021, the revenue of cobalt products was 2.562 billion yuan, accounting for 58.91% of the revenue, 65.89% of the gross profit, and 34.38% (+ 19.08%) of the gross profit margin. The revenue of electrolytic copper is 1.778 billion yuan, accounting for 40.87% of the revenue, 33.88% of the gross profit and 25.48% (- 7.08%) of the gross profit margin. Price: the average selling prices of cobalt products and copper products are 310900 yuan / ton (+ 63.43%) and 51400 yuan / ton (+ 26.21%) respectively. In terms of production and marketing: 1) due to the full release of the production capacity of the subsidiary Hanrui metal electrolytic copper project with an annual output of 20000 tons, the output of electrolytic copper in 2021 was 39900 tons (+ 46.09%), the sales volume was 34600 tons (+ 26.64%), and the inventory increased by 568103% year-on-year; 2) Due to the increase in the output of Anhui Hanrui 3000 ton cobalt powder project and the increase in the output of Congo Maite cobalt hydroxide, the output of cobalt products in 2021 was 7900 tons (+ 24.82%), the sales volume was 8200 tons (+ 38.08%), and the inventory decreased by 17.58% year-on-year.
Projects under construction can be expected in large quantities, and new energy materials are actively distributed. The projects under construction of the company include: 1) the cobalt hydroxide production capacity of Congo Hanrui metal increases by 5000 tons / year. It is expected to be put into operation in mid-2022, and the total cobalt hydroxide production capacity of Congo will reach 10000 tons / year. 2) The production capacity increment of Hanrui cobalt powder in Anhui, China is 2000 tons / year. It will be put into operation in early 2022, and the total production capacity of cobalt powder will reach 5000 tons / year. 3) The 10000 t / a cobalt salt and 26000 T / a ternary precursor projects of Ganzhou Hanrui, China are progressing smoothly. At present, the first phase of infrastructure construction has been completed and is expected to be put into operation by the end of June 2022.
The tight supply and demand pattern of the cobalt industry remains unchanged, and the cobalt price is expected to remain high. Demand side: thanks to the rapid increase in the penetration rate of global new energy vehicles and the demand for cemented carbide, the demand for cobalt continues to grow. Supply side: the global supply of cobalt resources mainly comes from Congo. The future cobalt ore increment is expected to mainly come from the resumption of production of Glencore mutanda, the production of China Molybdenum Co.Ltd(603993) indonesia hydrometallurgy project, but the global epidemic continues to impact the logistics and transportation and the progress of new projects is lower than expected. It is expected that the cobalt price will remain high in 2022.
The imminent listing of Hong Kong stocks will help the layout of new energy. At present, the Hong Kong Stock Exchange has reviewed the listing application submitted by the company and is still waiting for formal approval. According to the company’s Hong Kong stock prospectus, the raised funds are mainly used for overseas investment, acquisition and exploration of cobalt, nickel, lithium and other resources, and the expansion of production of cobalt salt, cobalt powder and ternary precursors. The advantages of convenient financing of Hong Kong stocks will help the company realize the layout of overseas resources, and the growth space will be further expanded.
Profit forecast and investment suggestions: the company continues to promote its production expansion projects and actively layout industrial chain integration and new energy. In 2022 / 2023 / 2024, the company will realize a net profit attributable to the parent company of RMB 1.076/12.55/1.370 billion, and the PE corresponding to the closing price on April 18 is 17x / 14x / 13X, maintaining the “recommended” rating.
Risk warning: the project progress is not as expected, the price of copper and cobalt falls, and the epidemic affects production and operation.
