\u3000\u3 China Vanke Co.Ltd(000002) 741 Guangdong Guanghua Sci-Tech Co.Ltd(002741) )
Events
On April 21, the company released its annual report for 2021. In 2021, the company achieved an operating revenue of 2.58 billion yuan, a year-on-year increase of 28.09%; The net profit attributable to the parent company was 62 million yuan, a year-on-year increase of 72.40%.
Comments
The leading position of PCB chemicals was consolidated, and the gross profit margin of lithium battery sector increased. As a leading enterprise of PCB chemicals, the company currently has a production capacity of 50000 tons of PCB chemicals and maintains full production operation; The company’s revenue of PCB chemicals reached 1.7 billion yuan, and the business proportion remained high. The gross profit margin of the company’s lithium battery industry increased rapidly, reaching 11.12%, an increase of 6.22 percentage points over 2020, and the gross profit margin increased significantly.
A number of businesses went hand in hand, and the lithium battery material project continued to advance. In terms of PCB chemicals, with the company’s continuous promotion of the integrated sales service mode of “overall solution of PCB manufacturing technology”, the performance of this sector increased significantly in 2021. In terms of the utilization of retired batteries, the company signed the strategic cooperation agreement with Aodong new energy, Lishen battery and other enterprises in 2021 to promote the construction of its industrial chain for the comprehensive utilization of retired power batteries. In terms of lithium battery materials, the company plans to raise 1.25 billion yuan to invest in the construction of high-performance lithium battery materials project in Zhuhai, and plans to build a comprehensive recovery production line with an annual output of 50000 tons of iron phosphate and 11500 tons of lithium carbonate.
The lithium battery recycling industry is booming, and the company’s performance is expected to continue to grow. In recent years, the new energy vehicle industry has developed rapidly. According to the data of power battery industry innovation alliance, the loading volume of lithium batteries in China reached 154.5gwh in 2021, a year-on-year increase of 143%; According to the data of China Automobile Association, in 2021, the sales volume of Shanxi Guoxin Energy Corporation Limited(600617) vehicles exceeded 3.5 million, with a year-on-year increase of 156%. With the continuous growth of the new energy vehicle industry, the current power battery recycling industry is in a strong growth stage. According to our prediction in the previous report, the total scale of power battery recycling is expected to reach 107.43 billion yuan in 2030. The company’s waste lithium battery recycling project enables the company to fully recover lithium carbonate and iron phosphate. According to Baichuan Yingfu, as of April 20, 2022, the quotation of iron phosphate is 25000 yuan / ton, a year-on-year increase of 92.31%, and the quotation of lithium carbonate is 475000 yuan / ton, a year-on-year increase of 431.05%. It is expected that with the continuous growth of China’s lithium battery recycling industry and the gradual implementation of relevant projects of the company, the company’s profits will continue to grow.
Investment advice
The business growth of the company is clear. It is expected that the net profit attributable to the parent company in 2022, 2023 and 2024 will be 184 / 435 / 612 million yuan and EPS will be 0.47/1.11/1.56 yuan respectively, corresponding to the PE share price on April 21, 2022, which is 32.66/13.81/9.82 times respectively. Maintain a “strongly recommended” rating.
Risk tips
The policy is less than expected, the sales volume of PCB chemicals is less than expected, and the production capacity release is less than expected.
