\u3000\u30 Shenzhen Quanxinhao Co.Ltd(000007) 92 Qinghai Salt Lake Industry Co.Ltd(000792) )
Event: on April 25, the company released the 2021 annual report and the first quarterly report of 2022. In 2021, the company achieved a revenue of 14.778 billion yuan, a year-on-year increase of 5.44%; The net profit attributable to the parent company was 4.478 billion yuan, a year-on-year increase of 119.58%; Net profit deducted from non parent company was 4.482 billion yuan, an increase of 109% year-on-year. In 2021q4, the company achieved a revenue of 3.980 billion yuan, an increase of 298.84% year-on-year and – 14.16% month on month; The net profit attributable to the parent company was 763 million yuan, a year-on-year increase of 1071% and – 52% month on month; The net profit deducted from non parent company was 550 million yuan, with a year-on-year increase of 1670% and a month on month increase of – 52%. The final performance exceeded the performance forecast. In 2022q1, the revenue reached 7.617 billion yuan, an increase of 152.5% and a ring increase of 91.39%; The net profit attributable to the parent company was 3.497 billion yuan, an increase of 340.91% and 358% respectively. The net profit deducted from non return to parent was 3.479 billion yuan, an increase of 343.33% and 532% respectively.
The simultaneous rise in the volume and price of lithium carbonate products helped the company create the best annual and single quarter performance in history. (1) Volume: in 2021, the company produced 22715 tons of lithium carbonate, with a year-on-year increase of 66.99%; The sales volume was 19285 tons, with a year-on-year increase of 39.75%; The production of potassium fertilizer was 5029600 tons, down 8.8% year-on-year; The sales volume was 4.7369 million tons, a year-on-year decrease of 26.55%. The output of potassium chloride of 2022q1 company is about 1.14 million tons and the sales volume is about 1.45 million tons; The output of lithium carbonate was about 7000 tons and the sales volume was about 6700 tons. The output increased by 144.9% year-on-year and the sales volume increased by 170.2% year-on-year. (2) Price: in 2021, the price of lithium carbonate products of the company increased from 27900 yuan / ton in 2020 to 94100 yuan / ton, a year-on-year increase of 237.6%. The average sales price of potash fertilizer was 2282 yuan / ton, up 41.35% from 1615 yuan / ton in 2020. The average ex factory prices of 60% and 57% potassium chloride powder of 2022q1 company were 3688 yuan / ton and 3548 yuan / ton respectively, with a year-on-year increase of 77% and 85% respectively; According to Asia metal network, the average price of 2022q1 industrial grade lithium carbonate was 403000 yuan / ton, up 469.7% year-on-year (3) Gross profit: the gross profit per ton of lithium carbonate in 2021 was 65900 yuan / ton, up 1803% year-on-year from 35000 yuan / ton in 2020; The gross profit per ton of potassium chloride was 1563 yuan / ton, up 74.1% year-on-year from 898 yuan / ton in 2020.
Attach importance to the strategic position of Qinghai Salt Lake Industry Co.Ltd(000792) as the “ballast stone” to ensure the supply of potash fertilizer and lithium salt in China. (1) The company has an annual production capacity of 5 million tons of potash fertilizer, ranking first in China and fourth in the world. China is one of the world’s largest potash fertilizer demanders, but its external dependence is about 50%. The company has improved the self-sufficiency rate of potash fertilizer in China and played the role of “ballast” of potash fertilizer supply to a large extent; (2) The company has formed a “1 + 2 + 3” salt lake lithium extraction project, in which Lanke lithium industry has reached the production capacity in phase I and is climbing the production capacity in phase II. The 30000 ton production line jointly invested by the company and Byd Company Limited(002594) is under pilot test, and the new capacity in the future is under planning. The company discharges 20 Fawer Automotive Parts Limited Company(000030) 0000 tons of LiCl of old brine every year, which may support the large-scale expansion of lithium production capacity in the future. The company will undertake the important task of ensuring China’s lithium resources.
The inventory of lithium carbonate and potassium fertilizer is sufficient, and we are optimistic about the release of performance under the high price of potassium and lithium. According to the company’s annual report, by the end of 2021, the company had 709100 tons of potassium fertilizer and 3435 tons of lithium carbonate. We believe that under the high price of potassium fertilizer and lithium salt and the heavy responsibility of ensuring supply, the performance flexibility in 2022 is prominent.
Investment suggestion: considering the continuous promotion of the company’s lithium resource layout and the rich profits of potash fertilizer, we expect the company’s net profit attributable to the parent company from 2022 to 2024 to be 14.766 billion yuan, 15.278 billion yuan and 15.713 billion yuan. Based on the closing price on April 25, 2022, the corresponding PE is 10x, 9x and 9x respectively, maintaining the “recommended” rating.
Risk tips: the demand is less than expected, the price of potassium and lithium has fallen sharply, and the project itself is less than expected.
