\u3000\u3 China Vanke Co.Ltd(000002) 050 Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) )
Performance summary: the company released the first quarterly report of 2022. In 2022q1, the company achieved a revenue of 4.8 billion yuan, a year-on-year increase of 40.1%; The net profit attributable to the parent company was 450 million yuan, a year-on-year increase of 25.8%; The net profit attributable to the parent company after non deduction was RMB 400 million, with a year-on-year increase of 25.3%.
The new energy market is booming, and the auto zero business is growing rapidly. According to the data of China Automobile Association, in the first quarter of 2022, the sales volume of Shanxi Guoxin Energy Corporation Limited(600617) vehicles increased by 142% year-on-year to 1246000. In March 2022, the penetration rate of new energy vehicles reached 21.5%, a record high, and the new energy market continued to be booming. As the leader of China Shanxi Guoxin Energy Corporation Limited(600617) thermal management, the company has perfect product pedigree and customers all over the world. It fully benefits from the rapid development of new energy market. It is speculated that the business of Q1 auto zero will maintain high growth.
The refrigeration sector grew steadily. In the first quarter, the overall supply and demand of the company’s refrigeration sector were booming and the growth was stable, mainly due to several reasons: 1) a large number of orders continued to flow into the company after competitors were acquired by downstream major customers; 2) The commercial industry expanded rapidly, and the company’s commercial business developed rapidly; 3) The new energy efficiency standard promotes the continuous improvement of the penetration rate of air conditioning electronic expansion valve and the sales volume of the company’s electronic expansion valve.
Profitability improved month on month. During the reporting period, the company’s gross profit margin was 23.3%, a year-on-year decrease of 3.9pp and a month on month increase of 1.7pp. Under the background that the price of raw materials is still high, the main reasons for the improvement of the company’s gross profit margin are as follows: 1) the company actively negotiated with customers and transmitted part of the cost to the downstream; 2) The company has carried out more active forward arbitrage to reduce the impact of exchange rate fluctuations. In terms of expense rate, the sales expense rate / management expense rate / R & D expense rate of 2022q1 company decreased by 2.2pp/0.9pp/0.1pp to 2.2% / 4.6% / 4.8% respectively year-on-year. Overall, the company’s net profit margin was 9.5%, a year-on-year decrease of 1.2pp and a month on month increase of 0.3pp.
The epidemic does not change the long-term trend of new energy. Since April, a number of new energy vehicle companies have suspended or faced suspension due to the epidemic, resulting in the suspension of some orders of the company, which is expected to put some pressure on the company’s auto zero business performance in the second quarter. We expect that the epidemic is difficult to change the long-term positive trend of the new energy vehicle industry, and the company’s orders are expected to recover soon with the easing of the epidemic in the future.
Profit forecast and investment suggestions. It is estimated that the company’s EPS from 2022 to 2024 will be 0.66 yuan, 0.86 yuan and 1.09 yuan respectively, and the net profit attributable to the parent company will maintain a compound growth rate of 32.7% in the next three years. Considering that the new energy market is still booming, the company, as the leader of new energy heat management, will fully benefit and maintain the “buy” rating.
Risk tip: the price of raw materials may fluctuate sharply, and the development of new energy market is less than expected.
