Who would have thought that Sungrow Power Supply Co.Ltd(300274) ( Sungrow Power Supply Co.Ltd(300274) . SZ), known as the “photovoltaic Mao”, not only failed to surprise investors, but created an unexpected shock.
On the evening of April 19, Sungrow Power Supply Co.Ltd(300274) disclosed the annual report of 2021. During the reporting period, the company achieved an operating revenue of 24.137 billion yuan, an increase of 25.15% year-on-year realized a net profit attributable to the parent company of 1.583 billion yuan , a year-on-year decrease of 19.01%.
This data is not only lower than market expectations, but also completely unexpected. After all, the company’s net profit attributable to its parent company in the first three quarters of last year has reached 1.508 billion yuan this means that the profitability of the company decreased significantly in the fourth quarter
At 8:00 that evening, Sungrow Power Supply Co.Ltd(300274) held a performance exchange meeting with institutional investors. Chairman Cao Renxian attended the meeting with board secretary Lu Yang and chief financial officer Li Guojun.
“We have experienced five waves of such competition and will carry the next competition.” Cao Renxian said at the performance exchange meeting.
However, investors still turned their faces quickly.
Affected by this, on April 20, Sungrow Power Supply Co.Ltd(300274) jumped into the air and opened low. After a slight rebound, it finally fell 20% to close at 72.08 yuan. The market value of company evaporated about 26.8 billion yuan in one day compared with the high point, its market value has shrunk by more than 50%
According to the latest estimate of 140000 shareholders, the average household loss is more than 190000 yuan.
Meanwhile, as soon as the financial report was released, CICC and Citigroup also quickly lowered their profit expectations.
Sungrow Power Supply Co.Ltd(300274) is a heavy position stock of many institutions. By the end of 2021, 136 institutions had held it, including 119 public funds. This performance downturn may strike the confidence of institutions.
chairman revealed
three reasons for the decline of performance
At the performance exchange meeting on the evening of April 19, Cao Renxian talked to institutional investors about three reasons for the decline in performance:
One is that the project in Vietnam was not connected to the grid in October due to the epidemic, and the implementation of the new electricity price led to the withdrawal,
Second, the Myanmar project was cancelled due to the coup, resulting in some expenses,
Third, the overseas energy storage business was affected by the epidemic and received a fine, resulting in increased revenue without increasing profits as a whole has lost about 1 billion performance
To sum up, Cao Renxian believes that 2021 is a little big , the estimation of chips and epidemic situation is also insufficient, and the internal management is not fine enough. “There are exchange losses of hundreds of millions, and the cost level is also improved due to the growth of personnel and R & D.”
fourth quarter “Waterloo” has long shown signs
In 2021, the growth pressure shown by Sungrow Power Supply Co.Ltd(300274) performance can be followed.
As early as the first three quarters, the growth of the company’s revenue and net profit showed signs of slowing down. But the real impact is the fourth quarter.
According to the financial report, in the fourth quarter of 2021, Sungrow Power Supply Co.Ltd(300274) the net profit in that quarter fell sharply – the operating revenue was 8.763 billion yuan, an increase of 22.34% month on month; The net profit attributable to shareholders of listed companies was 78 million yuan, down 89.57% month on month.
in fact, for the whole photovoltaic industry chain, the fourth quarter is usually the peak demand season taking 2021 as an example, the newly installed capacity of PV in China in the first three quarters was only 25.56gw, but with the emergence of nearly 30GW of newly installed capacity in the fourth quarter, the expected annual installation target was successfully completed.
However, the performance of Sungrow Power Supply Co.Ltd(300274) in the fourth quarter is in sharp contrast. Why?
According to public information, Sungrow Power Supply Co.Ltd(300274) main businesses include photovoltaic inverter, power station investment and development, energy storage system, wind power converter, etc. Among them, the investment and development business of photovoltaic inverter and power station achieved revenue of 9.051 billion yuan and 9.679 billion yuan respectively in 2021, accounting for 37.50% and 40.10% of the main revenue respectively. It is worth mentioning that the revenue of energy storage system business doubled last year, so its revenue proportion increased to 13.00%.
However, due to the decline in the proportion of photovoltaic inverter and power station investment and development business income, the development of Sungrow Power Supply Co.Ltd(300274) these two “fist” businesses have encountered different tests
In terms of photovoltaic inverters, the company’s shipments in 2021 reached a record high of 47gw, with a year-on-year increase of 34.29%. According to the caliber of Sungrow Power Supply Co.Ltd(300274) announcement, its inverter market accounted for more than 30% last year.
Combined with the business income, the average shipment price of Sungrow Power Supply Co.Ltd(300274) inverter single GW was 193 million yuan in 2021, compared with 215 million yuan / GW in 2020 This means that the overall average selling price of its inverter is declining.
The change in gross profit margin also reflects a slight decline in the profitability of Yangguan power inverter – in 2021, the gross profit margin of this business was 33.80%, a decrease of 1.23 percentage points compared with 2020.
and the main reason for the “Waterloo” of Sungrow Power Supply Co.Ltd(300274) fourth quarter performance is the power station investment business
“The core reason for the lower than expected performance in 2021 is the problems in the power station business.” Cao Renxian said at the performance exchange meeting.
It is reported that Sungrow Power Supply Co.Ltd(300274) in the fourth quarter of last year, some overseas power station projects were delayed or cancelled, resulting in the withdrawal. According to the relevant information at the performance meeting, the power station project of Sungrow Power Supply Co.Ltd(300274) in Vietnam was not connected to the grid in October 2021 due to the epidemic, and the new electricity price was implemented, resulting in the withdrawal; The Myanmar project was cancelled due to special reasons, resulting in some expenses. Superimposed with the penalty factors of overseas energy storage business, resulted in the performance loss of Sungrow Power Supply Co.Ltd(300274) of about 1 billion yuan
The intertwined factors have impacted the investment business of Sungrow Power Supply Co.Ltd(300274) power station, but Cao Renxian said, “EPC (power station investment) business will not become a stumbling block for the company.
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market value evaporated by more than 20 billion
crash driver who
While disclosing the annual report, Sungrow Power Supply Co.Ltd(300274) also disclosed the first quarterly report of 2022, with a net profit attributable to the parent company of 411 million yuan, a year-on-year increase of 6.26%. In the view of investors, this is also a figure lower than expected
“Now we have made arrangements for the epidemic situation, the price rise of the supply chain and the shortage of IGBT. The overall situation of 22q1 has recovered well, and the power station business has turned around its losses. The energy storage business has learned the lessons of last year. Last year, because people couldn’t go to the United States and some projects couldn’t do on-site commissioning, resulting in delivery problems. It is expected to be greatly improved, and on-site commissioning and acceptance can be done, so the goal is still relatively high.” Cao Renxian said at the performance exchange meeting on the evening of April 19 that the company’s inverter was affected by the shortage of devices and the laying of channels slowed down. “It is expected that a large number of domestic devices will be used this year, there will be ticket skipping of imported devices in Q1, and it is expected that Q2 will begin to alleviate. We are still full of confidence in the inverter business.”
Cao Renxian said that in the fourth quarter of last year, it was found that the business situation was not ideal, and some adjustments were made, “The first is the replacement of domestic devices, and the second is the improvement of channels and users (Q1 household shipments exceed 10000 sets, inverter revenue + 46%, energy storage revenue + 160%) 。 The reason why 22q1 is not in place is the order delay caused by shortage. There are some delays in American photovoltaic and European energy storage. These orders are still in place. Those not confirmed in March are expected to be completed from April to May this year is expected to continue the good situation of Q1. The goal of the whole year remains unchanged. We are confident to fight a turnaround ”
However, the secondary market does not seem to have “confidence” and jumped to the limit on April 20.
According to the after hours trading data of Shenzhen Stock Exchange, the largest sale on that day was the special seat of Shenzhen Stock connect, with an amount of about 9.06 yuan. The other four seats sold are for three institutions and Huatai Securities Co.Ltd(601688) Hefei innovation Avenue business department.
Among the bought seats, the largest amount is also the special seat of Shenzhen Stock connect, with an amount of about 447 million yuan. The other four sold seats are the special seats of three institutions and the business department of Nanjing Securities Co.Ltd(601990) Yinchuan Minzu North Street.
It can be seen that dominates the Sungrow Power Supply Co.Ltd(300274) limit, and the main capital is Shenzhen Stock connect
It is worth noting that after the results were announced, the two institutions lowered the target price of Sungrow Power Supply Co.Ltd(300274) ——
China International Capital Corporation Limited(601995) believes that the performance of Sungrow Power Supply Co.Ltd(300274) in 2021 and the first quarter of this year is lower than expected. Considering the impact of rising supply chain costs on the company’s profitability, the company lowered its profit forecast and lowered the target price by 45% to 105 yuan;
Citigroup pointed out that the profit of 3 Chongqing Sansheng Industrial Co.Ltd(002742) 021 was lower than expected, mainly due to higher component costs, reducing the company’s target price by 23% to 123 yuan.
revenue increased 31 times in 10 years
Starting from unpopular parts, Sungrow Power Supply Co.Ltd(300274) has been rooted in photovoltaic inverter for more than 20 years before becoming the “photovoltaic Mao” with a market value of 100 billion.
In 2010, the company’s revenue was only 600 million yuan. After listing the next year, the company’s revenue and profit basically increased steadily. By 2020, the revenue reached 19.286 billion yuan, an increase of 31 times in 10 years.
In September 2020, the Chinese government officially defined the “double carbon target”, and the photovoltaic industry experienced a wave of sharp rise. Sungrow Power Supply Co.Ltd(300274) is also like sitting on a rocket. The stock price soared all the way from $20. In July last year, it was as high as 180.16 yuan, with a market value of more than 260 billion yuan, becoming a super Bull Stock.
However, after the highlight, the cost game is getting worse. According to the performance report, the annual operating cost in 2021 was 18.77 billion, a year-on-year increase of 26.5%, higher than the growth rate of revenue of 25.2%.
“Dividends will not ebb, competition will intensify.”. Industry researchers predicted to the reporter of 21cbr that the concentration of inverter industry will be higher and higher in the future, and the core competitiveness will be reflected in price, brand and channel.
currently, Huawei is the main competitor of Sungrow Power Supply Co.Ltd(300274)
The survey shows that Huawei and Sungrow Power Supply Co.Ltd(300274) accounted for more than 60% of China’s photovoltaic inverter industry in 2020. Shipments in 2021 are almost equal.
100 billion leading stock price “not fragrant”
It is undeniable that although the investment business of Yangguan power inverter and power station encountered varying degrees of pressure last year, its energy storage business showed a certain growth momentum.
In 2021, the company’s energy storage system achieved an operating revenue of 3.138 billion yuan, a year-on-year increase of 168.51%.
in fact, the volume of energy storage business is an important factor supporting Sungrow Power Supply Co.Ltd(300274) valuation over the past two years, the global photovoltaic industry has entered a high boom, driving the continuous growth of the company’s photovoltaic business revenue. The high growth of energy storage business is expected to make a greater contribution to its overall performance.
Under the overall layout of “solar hydrogen storage”, this leading photovoltaic inverter enterprise has opened up diversified growth space, which is the reason why the capital market gave Sungrow Power Supply Co.Ltd(300274) high valuation in the early stage.
In October 2021, the market value of Sungrow Power Supply Co.Ltd(300274) reached its peak, exceeding 250 billion yuan.
However, overestimation needs strong performance as the foundation. Therefore, when the performance is lower than the market expectation, Sungrow Power Supply Co.Ltd(300274) ‘s share price will be tested.
in the view of some institutions, Sungrow Power Supply Co.Ltd(300274) may still be able to wait for an inflection point after the bad performance is achieved and the management of the company also predicted at the performance meeting that the boom in the second quarter of this year was much better than that in the same period last year.
In fact, the current stock price of Sungrow Power Supply Co.Ltd(300274) has suffered such a setback, which many investment institutions do not want to see.
On April 22, Sungrow Power Supply Co.Ltd(300274) the fixed increase shares issued in October last year will be lifted from circulation. At that time, Sungrow Power Supply Co.Ltd(300274) ‘s fixed issue price was 128 yuan / share, the number of shares issued was 284186 million, and the total amount of funds raised was 3.638 billion yuan. Its issuing objects include many large private equity funds and investment banking institutions, such as two fund products of Jinglin assets, JPMorgan, Yunnan Energy Investment Co.Ltd(002053) , UBS, etc.
Referring to the latest closing price, the above fixed increase share price fluctuated by 43.69%
