\u3000\u3 China Vanke Co.Ltd(000002) 110 Sansteel Minguang Co.Ltd.Fujian(002110) )
Events
The company released its 2021 annual report on the evening of April 26. In 2021, the company achieved a revenue of 62.753 billion yuan, a year-on-year increase of 29.02%; The net profit attributable to the parent company was 3.979 billion yuan, a year-on-year increase of 55.69%; The net profit deducted from non parent company was 4.048 billion yuan, with a year-on-year increase of 56.58%; EPS is 1.64 yuan.
Commentary
The steel output was stable and the annual performance was in line with expectations. In 21 years, the company produced 114039 million tons of steel, an increase of 0.29% at the same time; 9.6603 million tons of pig iron, with a decrease of 0.27%; 11.389 million tons of steel, with a decrease of 1.23%; 446900 tons of coke, with a decrease of 2.2%; 12.406 million tons of sinter into the furnace, an increase of 3.59% at the same time; 1.8475 million tons of pellets, an increase of 19.54%. In the 21st year, the company's comprehensive gross profit margin was 12.3%, with an increase of 0.61pcts. In 22 years, the company plans to produce 11.28 million tons of steel, 9.6 million tons of pig iron, 11.11 million tons of steel, 513000 tons of coke, 11.9 million tons of sinter and 2.09 million tons of pellets.
Promote transformation and upgrading and focus on cost control. The company will speed up the approval and construction process of capacity replacement and upgrading projects, and promote the construction of 360m2 Sintering Machine, coke oven upgrading phase II, new 1 blast furnace and other projects in Sanming headquarters. Expand the production varieties of the Second Steelmaking 3 continuous caster of the headquarters, and start the research and development of industrial materials and H-beam varieties of Luoyuan Minguang. The company continued to strengthen the whole process cost reduction. In 21 years, Sanming headquarters, Quanzhou Minguang and Luoyuan Minguang realized the whole process cost reduction of 33.08 yuan / ton, 34.47 yuan / ton and 10.6 yuan / ton respectively, with a total cost reduction and efficiency increase of 338 million yuan.
Integrating advantageous resources in the province, regional leaders are gradually taking shape. 19 years ago, the company successively acquired 100% equity of San'an iron and steel through fixed increase acquisition and established three wholly-owned subsidiaries such as Zhangzhou Minguang. In 20 years, the company acquired 100% equity of Luoyuan Minguang held by Sansteel group with its own funds. The acquisition will further broaden its sales network, integrate regional customer resources, greatly give play to synergy and improve the company's long-term profitability. After the acquisition, the total production capacity of the company increased to about 13 million tons, reduced transportation costs, increased the market share of the whole province to about 70%, and the regional leading position was gradually formed.
Profit forecast & investment suggestions
According to the company's 22-year business objectives, the net profit attributable to the parent company in 22-23 years is reduced by 17% and 19% respectively. It is estimated that the net profit attributable to the parent company in 22-24 years will be 3.290 billion yuan, 3.308 billion yuan and 3.316 billion yuan respectively, with corresponding EPS of 1.34 yuan, 1.35 yuan and 1.35 yuan respectively, and corresponding PE of 5 times, 5 times and 5 times respectively, maintaining the "overweight" rating.
Risk tips
Market operation risk of strong cycle in iron and steel industry; Risks of sharp fluctuations in raw material and energy prices.
