\u3000\u3 Shengda Resources Co.Ltd(000603) 181 Zhejiang Huangma Technology Co.Ltd(603181) )
Core view
Sustained high growth in 21 years: the company disclosed its annual report for 21 years, and achieved an operating income of 2.336 billion yuan during the reporting period, a year-on-year increase of 20%; The net profit attributable to the parent company was 448 million yuan, a year-on-year increase of 40%. The relocation of the factory was completed in 21 years, and more compensation was confirmed. The non net profit attributable to the parent deduction was 293 million yuan, with a year-on-year increase of 24.8%. Since 2016, except for the impact of the epidemic in 2020, the net profit deduction of the company has increased by 25% or more every year, realizing long-term high-speed growth. It is worth noting that the epidemic occurred in Shaoxing at the end of 21, resulting in the shutdown of enterprises for about 3 weeks, which significantly affected the company's Q4 performance. Otherwise, the performance growth rate in 21 years may be higher.
Special watch work is the driving force of growth: the company's product structure has been further optimized in the past 21 years, and the sales volume of large varieties with weak profits has further shrunk to 72000 tons, a year-on-year decrease of 21%. The sales volume of small varieties with core profit, namely special watch, increased by 19%. At the same time, the unit gross profit rebounded from 3330 yuan / ton, which was low in 20 years, to 3978 yuan / ton. The growth of sales volume and profitability of special watch is the main driving force for the high growth of the company's performance.
It is expected to reach a new high in 22 years: looking forward to 22 years, the capacity of the company's second plant will continue to release, the special surface active business will maintain rapid growth, and the newly expanded polyether amine and MS resin business will also start to increase in volume. In addition, the price of propylene oxide, the main raw material, decreased significantly year-on-year in 21 years, which will enlarge the profitability of the company in the short term. We judge that the non net profit deducted by the company in 22 years is expected to increase significantly.
Profit forecast and investment suggestions
Combined with the changes of production and sales volume, raw material price and subsidy confirmation of the company, we adjusted the company's net profit attributable to the parent company from 2022 to 2023 to 464 million yuan and 585 million yuan (557 million and 650 million yuan in the original forecast), and added a 24-year forecast to 730 million yuan. The valuation of comparable companies in 2022 was 17 times P / E. considering that the rate of return on Zhejiang Huangma Technology Co.Ltd(603181) investment and the certainty of growth were significantly better than those of comparable companies, a 30% premium was given, the target price was adjusted to 17.46 yuan, and the buy rating was maintained.
Risk tips
The commissioning progress of new projects is lower than expected; The price of raw materials fluctuates greatly; Loss of orders from key customers; The relocation of the old factory will have an impact.
