\u3000\u30 China Baoan Group Co.Ltd(000009) 33 Henan Shenhuo Coal&Power Co.Ltd(000933) )
On April 25, 2022, the company released the first quarter report of 2022. The company achieved an operating revenue of 10.75 billion yuan, an increase of 57.4% year-on-year and 11.6% month on month; The net profit attributable to the parent company was 1.95 billion yuan, a year-on-year increase of 232.6%, a month on month increase of 108.4%, and the net profit deducted from non attributable to the parent company was 1.937 billion yuan, a year-on-year increase of 276.3% and a month on month increase of 54.2%. The company’s forecast 22q1 net profit attributable to the parent and net profit deducted from non attributable to the parent were 1.74 billion yuan and 1.73 billion yuan respectively, with better performance than the company’s forecast.
Output continued to pick up and profits increased significantly. Volume: the company is expected to sell 1.66 million tons of coal and 360000 tons of electrolytic aluminum in the first quarter, including 200000 tons in Xinjiang and 160000 tons in Yunnan. Price: the price of electrolytic aluminum and coal of 2022q1 company has risen sharply. According to the products, the price of electrolytic aluminum is about 19630 yuan / ton, with a year-on-year increase of 37.2%, the price of lean coal is about 1840 yuan / ton, with a year-on-year increase of about 60%, and the price of anthracite clean coal is 1935 yuan / ton, with a year-on-year increase of about 92%; The price of thermal coal was 850 yuan / ton, with a year-on-year increase of 71%. The comprehensive price of coal of the company was 1402 yuan / ton, with a year-on-year increase of 85.7%. Cost: according to our calculation, the complete cost per ton of electrolytic aluminum is 13066 yuan / ton, including 12475 yuan / ton in Xinjiang and 14765 yuan / ton in Yunnan; The complete cost per ton of coal is 819 yuan / ton. Profit: Based on the above price and sales cost calculation, it is calculated that the net profit attributable to parent company per ton of coal is 392 yuan / ton, the net profit attributable to parent company per ton of electrolytic aluminum is 4880 yuan / ton, the net profit attributable to parent company per ton of Yunnan is 3605 yuan / ton, and the net profit attributable to parent company per ton of Xinjiang is 5322 yuan / ton.
Three fees and charges have decreased significantly. In 2022q1, the three fee expense of the company was 425 million yuan, down 439 million yuan month on month, of which the sales expense decreased 298 million yuan, mainly due to the significant increase of 21q4 transportation handling fee and the decrease of 172 million yuan in management expense, mainly due to the increase of 21q4 management salary and the increase of 32 million yuan in financial expense; On a year-on-year basis, the three fee expenses decreased by 313 million yuan, of which the financial expenses decreased by 313 million yuan, mainly because the 22q1 debt ratio decreased significantly and the interest expenditure decreased significantly; Administrative expenses decreased by 65 million yuan.
Future highlights: the resumption of production will be accelerated in 2022, and Yunnan Shenhuo will build 150000 tons or put into full operation at the end of April. According to the current production resumption progress, the company’s electrolytic aluminum output will reach 1624000 tons, a year-on-year increase of 16.0%, and the equity output will reach 1158000 tons, a year-on-year increase of 9.2%. 2) Shenlong Baoding’s new 60000 ton aluminum foil project began construction, and the power battery foil certification may be passed in the first half of the year. The 55000 ton double zero aluminum foil of Shenlong Baoding phase I has been completed and put into operation. At present, it mainly produces food foil and medicine foil, and is expected to switch to power battery foil in the future. It is expected that the certification of battery foil will be completed in the first half of 2022. In addition, Shenlong Baoding phase II investment in the production and construction of new energy power battery materials with an annual output of 60000 tons has been approved and started construction. 3) The industry continues to boom, and the price of coal and aluminum remains high. Overseas energy crisis, tight supply and poor domestic and foreign prices have kept the prosperity of China’s electrolytic aluminum industry. 4) Plan asset restructuring and inject Yunnan Shenhuo assets. On March 25, the company announced asset restructuring and may purchase the equity of Yunnan Shenhuo assets. The trading parties Shenhuo Group and commercial law Shenhuo fund hold 30.2% and 9.9% equity of Yunnan Shenhuo respectively. If the assets are injected, the company’s profit will be significantly thickened.
Investment suggestion: the pattern of electrolytic aluminum industry is good. With the resumption of production, the company’s performance will continue to release. We expect the company to realize the net profit attributable to the parent company of 6.617 billion yuan, 7.096 billion yuan and 7.251 billion yuan from 2022 to 2024, with EPS of 294 yuan, 3.15 yuan and 3.22 yuan respectively. The PE corresponding to the closing price on April 25 is 4, 4 and 4 times respectively, maintaining the “recommended” rating.
Risk tip: the demand for electrolytic aluminum is less than expected; The resumption of production of the project is less than expected.
