\u3000\u3 China Vanke Co.Ltd(000002) 701 Org Technology Co.Ltd(002701) )
Event: the company announced in its annual report that in 2021, it achieved an operating revenue of 13.885 billion yuan, a year-on-year increase of 20.22%, a net profit attributable to the parent of 905 million yuan, a year-on-year increase of 19.68%, and a net profit not attributable to the parent of 798 million yuan, a year-on-year increase of 53.09%. It is proposed to pay a cash dividend of 0.40 yuan (including tax) for every 10 shares.
Comments:
The business grew steadily and the leading position in the industrial chain was consolidated. Quarterly, Q1 / Q2 / Q3 / Q4 revenue increased by 64% / 25.5% / 6.8% / 5.7% respectively year-on-year. In terms of products, metal packaging products and services / filling increased by 17.95% and 13.54% respectively year-on-year in 2021. 1) In terms of three piece can business, both beverage cans and food cans maintained steady growth, mainly driven by the rapid recovery of China Red Bull business and the development of food cans. In terms of customers, the impact of legal disputes between the core customer of three piece cans, China Red Bull, tends to be stable. The company has put into operation its supporting Liaoning Kaiyuan production line project and Guizhou beverage can production project. In addition, the company started the second “factory in factory” project in Kedong factory for Feihe, and invested in the construction of a new milk powder can production base. 2) In terms of two-piece can business, the company’s two-piece can export business and capacity utilization have improved, strengthened in-depth cooperation with core customers, and built a can production project in Shandong Zaozhuang Tsing Beer Industrial Park to provide nearby services for Tsingtao Brewery Company Limited(600600) beer. 3) In terms of canning business, the company has 6 filling bases with an annual production capacity of more than 2 billion cans, providing packaging + filling integrated solutions for well-known brands such as China Red Bull, JDB, zhanma, Yuanqi forest, Yili, Coca Cola and Dongpeng.
The rise in raw material prices has compressed the profit space, and the company has taken many measures to actively respond. In 2021, the company’s comprehensive gross profit margin decreased by 5.34pct to 15.53% year-on-year, of which the gross profit margin of metal packaging products and services and filling business changed by -5.39pct and + 5.6pct year-on-year respectively. Q4 single quarter gross profit margin decreased by 3.9pct to 9.81% year-on-year. The decline of the company’s gross profit margin in 21 years was mainly due to the upstream raw material manufacturers increasing export orders and reducing China’s supply. At the same time, due to industrial structure adjustment, production and power restriction and other factors, the prices of aluminum and iron raw materials and processing fees increased throughout the year. The company hedges the impact of price rise on the supply side through the price transmission mechanism; At the same time, continue to strengthen production control, reduce the scrap rate and continue to implement material saving and consumption reduction projects to resist the rising pressure of raw materials. In terms of expenses, Q4 single quarter sales, management + R & D and financial expense rates changed by + 4.19pct, -0.2pct and -0.19pct respectively, the net interest rate decreased by 6.31pct to 2.07% year-on-year, and the net profit attributable to the parent company decreased by 71% year-on-year.
Profit forecast: Based on the strategic positioning of “integrated packaging overall solution provider”, the company continues to strengthen the service advantage of “can making + filling”, expand and optimize its own business structure and open a diversified service window for customers. At the same time, focusing on the strategic direction of “packaging +”, the company promotes its own brand FMCG products and enhances the new driving force for development. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 1.011 billion yuan, 1.116 billion yuan and 1.261 billion yuan respectively, with a year-on-year increase of 11.8%, 10.3% and 12.9% respectively. The current (2022 / 4 / 22) share price corresponds to 12.6x PE in 2022.
Risk factors: the risk of sharp rise in the price of raw materials and the risk that the downstream demand is lower than expected.
