\u3000\u30 Ping An Bank Co.Ltd(000001) 55 Sichuan New Energy Power Company Limited(000155) )
Event overview
On April 26, 2022, the company announced that based on the firm confidence in the company’s sustainable and stable development in the future and the recognition of the company’s value, on the premise of complying with laws and regulations, Sichuan energy investment plans to increase its shares with its own funds within 6 months from April 26, 2022, The number of shares to be increased shall not be less than 22138900 shares (accounting for 1.5% of the total share capital of the company) and not more than 29518500 shares (accounting for 2% of the total share capital of the company). There is no price range in this shareholding increase plan, and the shareholding increase plan will be gradually implemented according to the fluctuation of the company’s stock price and the overall trend of the capital market. On April 26, 2022, the company announced that the company had signed the equity acquisition intention agreement with the controlling shareholder Sichuan Energy Investment Group Co., Ltd. and its related parties Sichuan Energy Investment Holding Co., Ltd. and Chengdu chuanshang Xingneng equity investment fund center (limited partnership). After friendly negotiation, the company planned to acquire Sichuan energy investment, Sichuan energy investment capital Sichuan Merchants Fund holds 46.5% equity of Sichuan energy investment Dingsheng Lithium Industry Co., Ltd. On April 26, 2022, the company announced that the company and Sichuan Energy Investment Group Co., Ltd. signed the 43.74% equity acquisition intention agreement of Sichuan Guoli lithium Materials Co., Ltd. through friendly negotiation, the company plans to acquire 43.74% equity of Sichuan Guoli lithium Materials Co., Ltd. held by Sichuan energy investment in cash.
On April 26, 2022, the company announced that it had signed the 70% equity acquisition intention agreement of Beijing tus Qingyun Energy Technology Co., Ltd. with tus holdings, and the company planned to transfer 70% equity of tus Qingyun held by tus holdings.
Analysis and judgment:
Major shareholders honor their commitments and Dingsheng lithium’s equity will increase to 72%
As early as November 21, 2019, the company announced that it planned to acquire 51% equity of Dingsheng lithium industry held by chuanneng lithium energy fund. Since the lithium salt industry was in a downward cycle at that time, considering that the profitability of Dingsheng lithium industry could not have a positive impact on the company’s performance, the company announced on November 13, 2020 to suspend the acquisition. Sichuan energy investment, the controlling shareholder, plans to coordinate the direct distribution of Sichuan energy lithium energy fund in the form of fund liquidation, so that the company can directly hold the equity of Dingsheng lithium industry. Meanwhile, Sichuan energy investment promises to transfer its shares to the company after the performance of Dingsheng lithium industry meets the relevant requirements of the listed company. According to the company’s announcement, on February 1, 2021, the company held the first extraordinary general meeting of shareholders in 2021, reviewed and approved the proposal on the liquidation of lithium industry fund, agreed to liquidate the lithium industry fund, and the company directly held 25.5% equity of Dingsheng lithium (the scope of the company’s consolidated statements has not changed). On April 25, 2021, the company completed the delivery of 25.5% equity of Dingsheng lithium industry, and the company was entrusted to manage the total 25.5% equity of Sichuan energy investment and energy investment capital. This time includes not only the acquisition of 25.5% equity of Sichuan energy investment and Sichuan energy investment capital, but also the 21% equity held by Sichuan business fund. After the acquisition, the equity proportion of Dingsheng lithium will be increased to 72%, and the company plans to purchase 46.5% equity by paying cash. According to the company’s announcement, Dingsheng lithium completed and put into operation a 10000 ton lithium salt production line at the end of 2018, and the 5000 ton lithium carbonate technical transformation and expansion project has been successfully started at one time on April 24, 2022. In 2021, Dingsheng lithium achieved a net profit of 104221 million yuan. After Dingsheng lithium achieved profitability, the major shareholders immediately fulfilled their commitments and transferred their shares to the listed company, realizing the absolute control of Sichuan New Energy Power Company Limited(000155) and indicating the determination of the controlling shareholders to vigorously develop the lithium battery industry chain with Sichuan New Energy Power Company Limited(000155) as the platform.
Acquire 43.74% equity of Guoli lithium industry and increase the profit of lithium salt sector
In September 2017, Sichuan Energy Investment Co., Ltd. and Sichuan Yahua Industrial Group Co.Ltd(002497) jointly acquired the remaining 62.75% equity of Sichuan Guoli. After the acquisition, Sichuan Guoli was separated into two companies, Guoli lithium salt and Guoli mining, and increased capital and shares of the two companies in unequal proportions. Finally, it realized that Sichuan Yahua Industrial Group Co.Ltd(002497) holding and operating Guoli lithium salt and Sichuan energy investment holding and operating Guoli mining (i.e. Lijiagou mine). Sichuan energy investment holds 43.74% of the equity of Guoli lithium industry, but it has not been injected into the listed company. According to the company’s announcement, in 2021, China lithium industry realized an operating revenue of 4777633 million yuan and a net profit of 1036158 million yuan (audited). The company now plans to acquire 43.74% equity of Guoli lithium in cash, which will further increase the equity capacity of the company’s lithium salt business and thicken the profits of the lithium salt sector.
Acquire 70% equity of tus Qingyun and strengthen the layout of new energy power generation
The new energy power generation business has always been the main source of profit of the company. By the end of the disclosure period of the 2021 annual report, the company had put into operation 16 wind power photovoltaic projects, with a total installed capacity of 944200 kW and a photovoltaic installed capacity of 22400 kW. In 2021, the company achieved a total power generation of 238651 million kwh, including 235152 million kwh of wind power and 3499 million kwh of photovoltaic power. The growth of the company’s wind power business is relatively stable, with 2-3 new projects put into operation almost every year, but photovoltaic power generation has not been added in recent years. According to the company’s announcement, up to now, tus Qingyun holds 46 photovoltaic projects with a total installed capacity of 215600 kW. The projects are distributed in 12 provinces such as Jiangsu, Shandong, Hubei, Liaoning and Yunnan, with a power generation of 236 million kwh in 2021. The company’s acquisition of 70% equity of tus Qingyun will strengthen the company’s photovoltaic power generation capacity, help expand the main business, improve the company’s market share and comprehensive competitiveness in the photovoltaic industry, further implement the company’s new energy power generation industry development plan and accelerate the achievement of the company’s strategic objectives.
Major shareholders announced an increase in holdings, highlighting their confidence in future development
On April 26, the company announced that the controlling shareholder Sichuan energy investment plans to increase its shares with its own funds within six months from April 26, 2022. The number of shares to be increased is not less than 22138900 shares (1.5% of the total share capital of the company) and not more than 29518500 shares (2% of the total share capital of the company). There is no price range in this shareholding increase plan, and the shareholding increase plan will be gradually implemented according to the fluctuation of the company’s stock price and the overall trend of the capital market. Up to now, Sichuan energy investment and its persons acting in concert have held 45.98% equity of the company; Sichuan energy investment directly holds 34.68% of the company. At this point, the major shareholders plan to use their own funds, which shows that the major shareholders have firm confidence in the sustainable and stable development of the company in the future and recognize the value of the company. In the second half of 2021, Sichuan energy investment, the major shareholder, successively signed strategic cooperation agreements with Shudao group, honeycomb energy and Contemporary Amperex Technology Co.Limited(300750) and held working discussions with Eve Energy Co.Ltd(300014) in succession. On October 20, 2021, he strategically took shares in Sichuan Road & Bridge Co.Ltd(600039) , together with Byd Company Limited(002594) .
On October 28, Sichuan Road & Bridge Co.Ltd(600039) announced that Sichuan New Energy Power Company Limited(000155) and Sichuan Road & Bridge Co.Ltd(600039) jointly developed and constructed Mabian phosphate mine project Sichuan New Energy Power Company Limited(000155) and Sichuan Road & Bridge Co.Ltd(600039) , as listed companies under Sichuan energy investment group and Sichuan Shudao group respectively, are the implementation platforms of specific cooperation projects, and Mabian phosphate mine project is the first step of bilateral cooperation Sichuan New Energy Power Company Limited(000155) as the capital operation platform of Sichuan energy investment new energy sector, it has always been regarded as the top priority. In the future, it is expected to rely on the forward-looking layout of major shareholders and the joint advantages between state-owned enterprises to strive for more mineral resources and accelerate the integrated development of lithium resources in Western Sichuan.
Investment advice
The company plans to acquire 46.5% equity of Dingsheng lithium industry and 43.74% equity of Sichuan Guoli lithium materials in cash. After the acquisition, the company holds 72% equity of Dingsheng lithium industry and 43.74% equity of Sichuan Guoli respectively, so as to increase the equity capacity of the company’s lithium salt business. Under the high prospect of the lithium resource industry, the Lijiagou mine controlled by the company is about to be put into operation in 2022. At this time, the company acquires the lithium salt business to prepare for building an upstream and downstream integrated lithium resource industry chain, so as to maximize the retained profits of the lithium business sector. At the same time, strategic cooperation was carried out with Sichuan Road & Bridge Co.Ltd(600039) to supplement the layout of phosphate rock resources in the company’s new energy industry chain. At the same time, the company plans to purchase 70% equity of tus Qingyun by paying cash, improve the installed capacity of the company’s photovoltaic business segment, and expand and strengthen the lithium resources + green power business. In 2022, Lijiagou project will become the first rooting project of Sichuan New Energy Power Company Limited(000155) West Sichuan lithium mine development, which is expected to play a demonstration driving effect, help the company continue to give full play to the advantages of state-owned enterprises and accelerate the integrated development of lithium resources in West Sichuan. Since the above acquisition of the company is the initial announcement and has not been completed, we will not adjust the profit forecast of the company temporarily, and maintain the operating revenue of the company from 2022 to 2024 at 4.727 billion yuan, 12.713 billion yuan and 15.287 billion yuan, with a year-on-year increase of 7.2%, 168.9% and 20.3% respectively; From 2022 to 2024, the net profit attributable to the parent company was 945 million yuan, 2.505 billion yuan and 3.395 billion yuan respectively, with a year-on-year increase of 177.9%, 165.1% and 35.5% respectively. From 2022 to 2024, EPS was 0.64 yuan, 1.70 yuan and 2.30 yuan respectively, corresponding to the closing price of 14.21 yuan on April 26, 2022, and PE was 24 / 9 / 7X respectively, maintaining the “buy” rating.
Risk tips
1. The construction progress of lithium mine was less than expected and failed to be put into operation on time;
2. The price of lithium resources decreased significantly;
3. The acquisition and construction progress of lithium salt business is less than expected;
4. In the future, the integrated development of lithium resources in Sichuan by major shareholders is less than expected.
