\u3000\u3 China Vanke Co.Ltd(000002) 756 Yongxing Special Materials Technology Co.Ltd(002756) )
Event: on April 26, the company released its 2021 annual report and 22q1 quarterly report: 1) in 2021, the company achieved a revenue of 7.199 billion yuan, a year-on-year increase of 44.8%; The net profit attributable to the parent company was 887 million yuan, a year-on-year increase of 243.8%; Net profit deducted from non parent company was 764 million yuan, with a year-on-year increase of 322.6%. 2) In 2021q4, the company achieved a revenue of 2.277 billion yuan, an increase of 70.4% year-on-year and 21.4% month on month; The net profit attributable to the parent company was 337 million yuan, an increase of 8497.5% year-on-year and 36% month on month; Net profit deducted from non parent company was 312 million yuan, with a year-on-year increase of 194133% and a month on month increase of 49.4%. 3) In 2022q1, the company achieved a revenue of 2.631 billion yuan, an increase of 94.3% year-on-year and 15.5% month on month; The net profit attributable to the parent company was 811 million yuan, with a year-on-year increase of 553.6% and a month on month increase of 140.9%; Net profit deducted from non parent company was 769 million yuan, with a year-on-year increase of 757.2% and a month on month increase of 146.1%.
The volume and price of lithium products have risen simultaneously, thickening the performance. 1) Volume: production and sales rise together. In 2021, the company achieved an output of 11400 tons of lithium products, with a year-on-year increase of 30.26%; The sales volume of lithium products was 11200 tons, with a year-on-year increase of 16.88%. 2) Price: the industry continues to boom, and the price of lithium rises. The company’s average sales price of lithium salt in 2021 was 108900 yuan / ton, an increase of 241.11% year-on-year compared with 31900 yuan / ton in 2020. 3) The price of lithium in 22q1 is high and the performance is thickened: the company’s 22q1 performance is outstanding, with a single quarter net profit of 811 million yuan, an increase of 553.60% year-on-year, close to the annual net profit of 887 million yuan in 2021; 22q1, the company’s lithium new energy business achieved 2720 tons of lithium carbonate sales and a net profit of 7214686 million yuan. It is estimated that the net profit after tax of a single ton has reached 265000 yuan / ton.
The upstream resource end continues to expand, and the lithium salt production expansion is accelerated simultaneously. (1) On the spot, the production scale in the mining license of Huaqiao mining Huashan porcelain stone mine, the holding subsidiary of the company, has been changed to 3 million tons / year. The overall self supply rate of raw materials of the company has continued to increase. Supporting the production of 20000 tons of phase II lithium carbonate project this year, the company has released considerable performance this year. (2) In the long run, the company will accelerate the construction of lithium salt smelting end, and plans to jointly build 50000 tons of lithium carbonate and 20000 tons of lithium carbonate projects with Contemporary Amperex Technology Co.Limited(300750) , Jiangxi tungsten industry respectively. The long-term growth is expected to open up the future growth space.
The special steel business has developed steadily and has broad development space. At present, the company is the leading enterprise of stainless steel long products in China, and the market share of stainless steel rods and wires in China has been in the top two for a long time. In 2021, the company’s stainless steel business achieved product sales of 313600 tons, operating revenue of 5.975 billion yuan and net profit attributable to the parent company of 418 million yuan. The national development and Reform Commission requires that crude steel output continue to be reduced this year, and steel output is limited. With the gradual resumption of work in East China, the policies of reducing reserve requirements, relaxing real estate and steady growth of infrastructure construction are gradually put into force, the steel consumption is expected to improve, and the development potential of the company’s special steel business is released.
Investment suggestion: considering the long-term growth of new energy vehicles, the lithium industry is expected to continue to prosper, the layout of the company’s lithium business is progressing smoothly, the self-sufficiency rate of resources is improved, and it is deeply bound with the downstream leading battery factory. In addition, the company’s special steel new material business is growing steadily. We estimate that the company’s net profit attributable to the parent company from 2022 to 2024 will be 4.941 billion yuan, 5.942 billion yuan and 6.358 billion yuan. Based on the closing price on April 26, 2022, the corresponding PE will be 7x, 6x and 5x respectively, Maintain a “recommended” rating.
Risk tips: the demand is less than expected, the price of lithium has fallen sharply, and its own projects are less than expected.
