\u3000\u3 China Vanke Co.Ltd(000002) 493 Rongsheng Petro Chemical Co.Ltd(002493) )
Event: the company released the annual report of 2021: in 2021, the operating revenue was 177024 billion yuan, a year-on-year increase of 65.03%, the net profit attributable to the parent company was 12.824 billion yuan, a year-on-year increase of 75.46%, and the net profit deducted from non attributable to the parent company was 12.432 billion yuan, a year-on-year increase of 95.91%. 2021q4 achieved an operating revenue of 47.667 billion yuan, a year-on-year increase of 60.77%, a month on month increase of 6.07%, a net profit attributable to the parent company of 2.702 billion yuan, a year-on-year increase of 63.07%, a month on month decrease of 27.69%, and a deduction of non attributable net profit of 3.126 billion yuan, a year-on-year increase of 256.54% and a month on month decrease of 6.84%.
Comments:
Large refining and chemical production capacity continued to be released, and the company’s operating performance increased significantly. In 2021, the company realized a net profit attributable to the parent company of RMB 12.824 billion, a year-on-year increase of 75.46%. In terms of profitability, in 2021, the gross profit margin was 26.51%, with a year-on-year increase of 6.8pct, the net profit margin was 13.36%, with a year-on-year increase of 0.89pct, and the ROE (diluted) was 26.26%, with a year-on-year increase of 6.49pct, maintaining a strong profitability. In terms of period expenses, the total period expense rate of 2021 company was 4.32%, with a year-on-year increase of 0.5pct. Among them, the sales expense rate was 0.09%, a year-on-year decrease of 0.02pct, the management expense (including R & D expenses, comparable caliber) rate was 4.81%, a year-on-year increase of 0.71pct, the financial expense rate was 1.64%, a year-on-year increase of 0.2pct, and the company’s expense rate increased slightly, mainly due to the increase in the sales volume of Zhejiang Petrochemical products, personnel, loans and R & D expenses of the subsidiary. The company’s output of refining and chemical projects is climbing, the extension of large refining and chemical platform, the diversification of downstream products and the cost advantage brought by the company’s integration are the reasons for the performance growth.
The rise of oil price drives the price difference of products, and the expansion of production capacity benefits the prosperity of the industry. The average price of Brent crude oil in 2021 was US $71 / barrel, with a year-on-year increase of 69.16%. The rise of oil price pushed up the price of main products. According to wind, the average price of PX (reference price) in 2021 is 6368 yuan / ton, with a month on month ratio of + 1581 yuan / ton (+ 33.03%); The average price of PTA (East China) was 4716 yuan / ton, a year-on-year increase of + 1112 yuan / ton (+ 30.87%); The average price of polyester filament POY was 7394 yuan / ton, a month on month increase of + 1858 yuan / ton (+ 33.57%); In terms of naphtha, the average price difference was 64.370 US dollars / ton, a year-on-year increase of 25%. The average price difference of pta-px (domestic) was 513 yuan / ton, with a year-on-year increase of 15.6%; The average price difference of bisphenol a-phenol-acetone was 6579 yuan / ton, a year-on-year decrease of 5.84%; The average price difference between POY, PTA and ethylene glycol was 1579 yuan / ton, a year-on-year increase of 58.07%. The company’s capacity expanded rapidly: in 2021, the company had a PX capacity of 10.5 million tons / year (5.6 million tons / year in 2020) and a PTA capacity of about 19 million tons / year (13 million tons / year in 2020); The total production capacity of polyester filament, bottle chip and film is 4.5 million tons / year, ranking the top in China. It fully benefits from the business cycle and brings significant performance flexibility.
The benefits of Zhejiang Petrochemical are fully released, and the new material industry chain is gradually taking shape. In January 2021, Zhejiang Petrochemical’s 40 million T / a refining and petrochemical integration project (phase II) was fully put into operation. In 2021, Zhejiang Petrochemical achieved a net profit of 22.296 billion yuan, with the company holding 51%, contributing a net profit of 11.37 billion yuan to the company. Since the phase I project was put into operation, the production of each unit has progressed smoothly, the operating load has increased steadily, and the profitability has been gradually enhanced. The company’s Zhejiang Petrochemical phase II project completed the preliminary work such as engineering construction, equipment installation and commissioning on November 1, 2020, put the atmospheric and vacuum distillation and related utilities into operation, and the downstream oil refining and chemical plants successively entered the stage of production and commissioning. The full operation of the phase II project added 20 million tons / year of oil refining capacity, 6.6 million tons / year of aromatics and 1.4 million tons / year of ethylene production capacity to the company. According to the company’s announcement, the Ministry of Commerce has approved and agreed to arrange the non-state trade import quota of crude oil for Zhejiang Petrochemical phase II project in 2021, which will drive the company’s performance to a higher level. In terms of new materials, according to the ethylene division of Zhejiang Petrochemical Co., Ltd., 1300000 T / a LDPE-EVA unit was successfully commissioned at no-load on September 20, and the unit produced qualified products less than a week after feeding; In addition, yishanhua, Hainan Yisheng bottle grade slicing project and RPET project have been put into operation successively, Ningbo Yisheng new material 6 million T / a PTA project, Ningbo Zhongjin Petrochemical 200000 t / a xylene project have successfully produced products, Shaoxing Yongsheng technology optical film and photovoltaic backplane film under construction projects have been put into operation, the planned project is under construction, and Shengyuan chemical fiber phase II is also under intensive construction. The company continues to expand the industrial chain of new materials, continuously promote the growth of product added value, and bring about a quadratic growth curve.
Risk tips: 1) the epidemic repeatedly affects the macroeconomic downside risk; 2) Risk of sharp decline in international crude oil prices; 3) Risk that the project is put into operation less than expected; 4) Geopolitics brings downside risks to the economy.
Due to the fluctuation of the company’s forecast price of “chemical products” (RMB 17.24 billion) and “original products” (RMB 17.24 billion), we expect to maintain the profit of “chemical products” (RMB 17.24 billion) and “original products” (RMB 17.24 billion), which are significantly adjusted as the profit of the company in 2024.
