\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 031 Sany Heavy Industry Co.Ltd(600031) )
Event: Sany Heavy Industry Co.Ltd(600031) released the 2021 annual report. The company achieved an operating revenue of 106873 billion yuan in 2021, with a year-on-year increase of 6.82%; The net profit attributable to shareholders of listed companies was 12.033 billion yuan, a year-on-year decrease of 22.04%; The net profit attributable to shareholders of listed companies after deducting non recurring profits and losses was 10.291 billion yuan, a year-on-year decrease of 26.22%.
Comments:
2021q4 performance loss and profitability decline. The company achieved a revenue of 106873 billion yuan in 2021, a year-on-year increase of 6.82%; The net profit attributable to the parent company was 12.033 billion yuan, a year-on-year decrease of 22.04%. The company’s performance was under pressure, mainly due to the weakening demand of downstream industries for construction machinery. In 2021, the gross profit margin was 25.85%, with a year-on-year decrease of 3.97 PCT; The net interest rate was 11.62%, a year-on-year decrease of 4.35pct; During the period, the expense rate was 14.83%, with a year-on-year increase of 2.03 PCT, mainly due to the increase of 0.94 PCT, 0.39 PCT and 1.10 PCT in sales expense rate, management expense rate and R & D expense rate respectively. In 2021q4, the revenue reached 18.592 billion yuan, a year-on-year decrease of 30.18% and a month on month decrease of 10.54%; The net profit attributable to the parent company lost 533 million yuan, a year-on-year decrease of 117.89% and a month on month decrease of 121.37%. The company’s single quarter performance fell sharply in the fourth quarter, mainly due to increased expenses, investment losses and credit impairment; The gross profit margin was 18.87%, down 9.62pct year-on-year and 5.77pct month on month; The net interest rate was – 2.90%, a year-on-year decrease of 14.72 PCT and a month on month decrease of 15.35 PCT.
Actively promote the transformation of digitization and automation, and make breakthroughs in motorized products. The company insists on taking digitization as the first strategy and actively promotes digital transformation. In 2021, the construction of 22 lighthouse factories was promoted, and a total of 14 lighthouse factories have been completed and reached production capacity. The production capacity has been increased by 70%, the manufacturing cycle has been shortened by 50%, and the overall automation rate of the process has been greatly improved Sany Heavy Industry Co.Ltd(600031) Beijing piling machine factory was successfully selected into the new list of Lighthouse factories in the global manufacturing field released by the world economic forum, becoming the first certified lighthouse factory in the global heavy industry. In 2021, the company achieved a major breakthrough in the sales of electric mixer, electric dump truck and electric crane, and won the annual sales champion. The sales volume of electric engineering vehicles exceeded 1000, and the market share ranked first in the industry.
Strengthen the internationalization strategy and accelerate the research and development of international products. In 2021, the company’s internationalization strategy made positive progress. The company’s overseas revenue was 24.846 billion yuan (excluding Putzmeister revenue of 19.022 billion yuan), an increase of 76.16% year-on-year, accounting for 23.25% of the total revenue and an increase of 9.15 PCT year-on-year. The company firmly promoted the internationalization strategy, implemented the business strategy of “focusing on ourselves, local operation and service first”, and made great progress in the construction of overseas market channels, service capacity and service parts system. In 2021, the company greatly enhanced its international R & D strength, established an international R & D team of about 800 people, established overseas R & D centers in the United States, Germany and India, comprehensively accelerated international projects, and created an iron triangle model of sales, service and R & D. In 2021, 68 international products were listed and on sale, focusing on the mainstream markets in Europe and the United States, and the coverage of many main models was improved.
Investment advice: maintain the “recommended” rating. The company is one of the leading enterprises of construction machinery in China. Actively promoting the transformation of digitization and automation and firmly implementing the internationalization strategy will effectively support the development of the company. It is estimated that the company’s EPS from 2022 to 2024 will be 1.42 yuan, 1.64 yuan and 1.74 yuan respectively, and the corresponding PE will be 12 times, 10 times and 10 times respectively.
Risk tips: (1) if the infrastructure / real estate investment is less than expected, the company’s product demand will weaken; (2) If the issuance progress of special bonds slows down or the issuance amount is lower than expected, the number of downstream projects will be reduced and the product demand of the company will weaken; (3) If the overseas market reduces the demand for Chinese enterprise products, the company’s performance will be under pressure; (4) If the price of raw materials rises sharply, the company’s performance will face great pressure.
