\u3000\u3 Shengda Resources Co.Ltd(000603) 856 Shandong Donghong Pipe Industry Co.Ltd(603856) )
Event: the company released 21fy and 22q1 results. The annual revenue was 2.21 billion yuan, a year-on-year decrease of 7.7%, the net profit attributable to the parent was 133 million yuan, a year-on-year decrease of 58%, and the net profit not attributable to the parent was 123 million yuan, a year-on-year decrease of 60%. 22q1 revenue / net profit attributable to parent company: 510 / 430 million yuan, yoy + 27.8% / + 2.6%. The company's revenue / net profit budget for 22 years was 4.2 billion yuan, a year-on-year increase of + 90% / 203%
The scale of revenue remained stable, and the proportion of anti-corrosion pipeline products increased
In terms of business, the income of PE / steel wire / anti-corrosion / thermal insulation / PVC pipes and fittings in 21 years was 4.1/4.1/4.8/1.7/0.4 billion yuan; The sales volume of the five types of products is 35000 / 2.7 / 6.4 / 2.2 / 5000 tons respectively, with a total sales volume of about 153000 tons, yoy + 1%, the average price is 1.2/1.5/0.76/0.769000 yuan / ton, yoy-2.6% / - 2.2% / + 4.8% / - 13.9% / - 23.6%. In terms of downstream application, the revenue of water supply and drainage / industrial and mining / gas is 1.34/3.1/0.7 billion yuan, yoy + 4.7% / 4.2% / - 67.5%. The total sales volume of 21q1 company was 44600 tons, a year-on-year increase of 47%, and the output was 53100 tons, a year-on-year increase of 141%. We believe that the company's main downstream water supply and drainage is expected to fully benefit from steady growth, and the subsequent company's shipment volume is expected to maintain rapid growth.
22q1 turns losses month on month, and the cost pressure can be alleviated
21fy's gross profit margin was 19.5%, down 6.8pct year-on-year; The net interest rate was 6%, a year-on-year decrease of 7.3pct. There are three main reasons: 1) the price of raw materials PVC, steel wire and steel strip is yoy + 22% / 24% / 35%, resulting in the gross profit margin of the company's main products anti-corrosion / steel wire / PE pipeline decreasing by 9.5/6.1/4.8pct respectively; 2) The company terminated the issuance of convertible bonds and converted to self raised funds to build new production capacity, resulting in an increase in the financial expense ratio of 0.75pct to 0.92%, and further pressure on the net profit; 3) The provision for bad debt of accounts receivable increased, and the annual impairment reached 41.9 million yuan (32.04 million yuan in the same period last year). The CFO of 21fy company was - 200 million yuan, compared with - 27 million yuan in the same period last year, with a cash payment ratio of 108%, a year-on-year increase of + 14 PCT, which is expected to be mainly due to the increase of raw material reserves. According to the data of 22q1, the purchase price of most raw materials of the company has decreased to a certain extent compared with 21fy. At the same time, the price of some products has increased to a certain extent. The gross profit margin of 22q1 has increased by 8pct month on month, and the net profit margin has increased significantly to 8.5% month on month. However, due to the impact of income composition, the profit margin still has a certain decline year-on-year. We believe that the gross profit margin of various products has room for improvement throughout the year, and the profit margin of the whole year is expected to be higher than Q1.
After the expansion, the company has sufficient production capacity, multi pronged expansion of channels, and maintains the "buy" rating
At the end of 21fy, the company has formed a capacity of about 270000 tons, including PE / steel wire / anti-corrosion / thermal insulation / PVC capacity of 8.9/7.7/7.1/2.814000 tons, which has a high growth foundation from the capacity side. On the other hand, the company actively expanded its channels. In the direct sales channels, the company reached cooperation with a number of local government platforms, design institutes, infrastructure central state-owned enterprises and financial institutions last year, and large orders are expected to grow rapidly. On the product side, the company's advantages in the field of large-diameter pipelines continue to increase. In the future, it is expected to rapidly increase the market share with the help of channels and cost advantages. Although the volume of the distribution side is small, it achieved a revenue increase of nearly 40% last year. Considering the impact of the epidemic, we lowered the company's profit forecast and estimated that the net profit attributable to the parent company in 22-24 years was RMB 390 / 4.8 / 630 million (the previous value was RMB 401 / 515 million in 22-23 years), corresponding to pe7 / 5.6 / 4.3 times, maintaining the "buy" rating.
Risk tips: the price of raw materials has risen sharply, the new capacity cannot be digested in time, and macro policy risks
