\u3000\u3000 Shandong Nanshan Aluminium Co.Ltd(600219) (600219)
Key investment points
Electrolytic aluminum: the price of aluminum rose sharply year-on-year in the whole year, fell rapidly in the fourth quarter, and has bottomed up at present
In 2021, the electrolytic aluminum industry was greatly affected by the carbon peak and carbon neutralization policies, and energy consumption and power shortage jointly restricted the supply of the industry. According to the statistics of Baichuan Yingfu, in 2021, China's electrolytic aluminum production scale was 3.75 million tons, and the total re production capacity was 1.47 million tons; In 2021, a new capacity of 1.885 million tons will be built, of which 585000 tons have been put into operation, 1.3 million tons have not been put into operation, and 800000 tons are currently under construction. According to Shanghai Aladdin Biochemical Technology Co.Ltd(688179) data, compared with the beginning of the year, the total electrolytic aluminum production capacity increased by 250000 tons in November 2021, and the in-process production capacity decreased by 2.25 million tons. The cost side fell after rising rapidly, and the profit of electrolytic aluminum has bottomed up. After entering November, the prices of upstream bauxite, coal and caustic soda fell rapidly, and the profit of electrolytic aluminum has changed from a loss of - 512 yuan / ton in November to a profit of more than 3000 yuan / ton in January.
It is expected that with the gradual promotion of policies related to steady growth, China's monetary policy is expected to be moderately loose. In terms of fiscal policy, "accelerating the progress of expenditure" and "moderately ahead of infrastructure investment", the short-term macro level's concern about falling commodity prices and stalled demand has bottomed out. With the gradual development of China's policies, After drastic adjustment, cyclical stocks are expected to have a new round of market at the end of the year.
Core high-end products: high-end products enter the large-scale period, and the company's early R & D investment and investment enter the harvest period
2021 is a year when the company's high-end products begin to increase in large quantities. The proportion of high-end core products continues to increase, and the company's strategic positioning of high-end manufacturing and intensive processing is gradually consolidated.
(1) automotive aluminum plate: with the consensus reached by countries around the world on "carbon peaking and carbon neutralization", new energy vehicles show a rapid and vigorous development momentum. According to the data of the passenger Federation, from January to December 2021, the retail volume of traditional fuel vehicles decreased by 1.02 million, a year-on-year decrease of 6%, while the volume of new energy vehicles increased by 1.88 million, a year-on-year increase of 169%, and the penetration rate of new energy vehicles increased rapidly, In December, the penetration rate of new energy passenger vehicles exceeded 20%. The company is the only company in China that can produce passenger car aluminum plate on a large scale. The production and sales of its core product automotive aluminum plate were booming in 2021, with a significant year-on-year increase, the sales volume exceeded 110000 tons, and the overall profit increased significantly, further consolidating the company's position as a leading enterprise in China's automotive plate.
(2) battery aluminum foil: the company will build a new 21000 ton high-performance power battery foil production line, which will be put into trial production in October 2021. After the project is completed, the company's total annual output of high-performance power battery foil products will reach more than 30000 tons. The company focuses on the high-end market in the power battery aluminum foil plate, mainly 12um products, and a small amount of 10um products are also available at present, It has become one of the core suppliers of high-performance battery aluminum foil products in China.
(3) the company's high-end core products include automotive aluminum plate, battery aluminum foil and aviation plate. It is expected that the sales volume of core high-end products will account for 11.1%, 15.7% and 26.0% from 2021 to 2023, and the gross profit will account for 20.7%, 26.8% and 39.3%, driving the steady growth of the company's performance.
Alumina: Indonesia alumina phase I project is put into operation, which not only increases resource guarantee, but also helps to extend the industrial chain and reduce profit volatility
From August to October this year, alumina prices rose rapidly, eroding the profits of some pure electrolytic aluminum enterprises. However, due to the company's original 1.4 million tons of alumina production capacity in China, it can partially stabilize the profit fluctuation. The company's 1 million ton alumina project in Indonesia phase I was put into trial production in May 2021 and successfully reached production in September 2021, which has become a new source of profit for the company. The 1 million ton alumina project in Indonesia phase II under construction is expected to be put into operation next year. After phase II is put into operation, it will further reduce costs and increase resource guarantee. Higher self-sufficiency rate will also reduce the volatility of the company's overall profit.
The repurchase plan continued, demonstrating the company's confidence in the soundness and improvement of its fundamentals
Based on the confidence in the future development prospect of the company and the high recognition of the company's value, and enhancing the confidence of investors in the company, the company repurchases some public shares of the company with its own funds through centralized bidding transaction. The planned repurchase amount is RMB 800-16 billion, and the number is no less than 133 million shares (accounting for about 1.12% of the total share capital of the company). As of December 31, 2021, the company has repurchased 59.46 million shares, accounting for 0.50% of the total share capital of the company, with a total transaction amount of 279 million yuan. This repurchase fully demonstrates the company's confidence in its own business growth. We believe that in the future, with the large volume of the company's core high-end products and the bottom of the electrolytic aluminum industry, the company's performance will grow at a high speed with strong certainty.
Profit forecast and valuation
It is estimated that the company's net profit attributable to the parent company from 2021 to 2023 will be 3.255 billion yuan, 3.981 billion yuan and 5.348 billion yuan, with a year-on-year increase of 58.83%, 22.28% and 34.37%, corresponding to 18.1 times, 14.8 times and 11.0 times of PE. Considering the rapid increase in the proportion of high-end products and the strength of policies related to steady growth in 2022, the company is currently in the period of profit bottom reversal. The company has both steady growth and cycle flexibility, and maintains the "buy" rating.
