\u3000\u3000 Wuxi Shangji Automation Co.Ltd(603185) (603185)
Announcement: 2021 performance forecast: a year-on-year increase of 207% – 239%; We expect 2021q4 to be a phased performance low
1) net profit attributable to parent company: it is expected to be RMB 1.63-1.8 billion in 2021, with a year-on-year increase of 207% – 239%. Looking at Q4 of 2021 alone, the net profit attributable to the parent company is expected to be 230-400 million yuan, with a year-on-year increase of 19% – 109% and a month on month decrease of 29% – 60% compared with Q3.
2) net profit attributable to parent company after non deduction: it is expected to be RMB 1.43 billion to RMB 1.6 billion in 2021, with a year-on-year increase of 179% – 212%.
3) non recurring profit and loss: it is estimated that it will be about 200 million yuan in 2021. It is judged that it is mainly the investment income of 5% silicon material of Xinjiang GCL.
2021q4 performance was lower than expected. The price of 2021q4 photovoltaic silicon material and silicon wafer fluctuated greatly. We estimate that the company maintained a relatively high operating rate in the industry (to expand market share) when the price of silicon material is high, resulting in a decline in profitability. At present, the price of silicon material has stopped falling and stabilized after four weeks of decline, and the price of silicon wafer has rebounded slightly recently. As the price of silicon wafer stabilizes, we expect 2021q4 to be the low point of the company’s phased profit, and 2022q1 is expected to recover gradually. The shortage of silicon material in 2021 will continue a good competition pattern for silicon wafers. It is expected that the silicon material capacity will still determine the silicon wafer output in 2022, and the profitability of silicon wafers is good as a whole. At present, the company’s monocrystalline silicon production capacity reaches 30GW. It is not ruled out to further expand production in 2022. It is expected that the shipment volume is expected to more than double in 2022.
Granular silicon project: strengthen the competitiveness of silicon wafers and bring profit growth points; Recently, the granular silicon project has been recognized by the new capital
1) granular silicon + high-purity nano silicon project. Recently, the granular silicon project has been recognized by the capital: the company has increased capital by 1.02 billion yuan and jointly invested in the project with an annual output of 100000 tons of granular silicon + 150000 tons of high-purity nano silicon. Recently, Tibet Ruihua invested 580 million yuan to increase the capital of Xinyuan silicon material (Baotou granular silicon project company), and the granular silicon was recognized by the capital again. At present, Jiangsu Zhongneng, Wuxi Shangji Automation Co.Ltd(603185) , Gaojia Cecep Solar Energy Co.Ltd(000591) and Tibet Ruihua hold 55%, 27%, 2.6% and 15.4% shares of Inner Mongolia Xinyuan respectively (the total investment of the project is expected to be 8.9 billion yuan).
2) after putting into operation, the machine will obtain no less than 70% of granular silicon (corresponding to 70000 tons), which can meet the silicon material demand of 25gw silicon wafer in the future, and strengthen the silicon material support capacity and the core competitiveness of silicon wafer.
3) the granular silicon + nano silicon project is expected to be put into operation in the third quarter of 2022, bringing new major profit growth points. We expect to bring new profit growth points to the company’s performance in 2022 and 2023. (assuming that the price of silicon material is 100000 yuan / ton and the price of silicon powder is 15000 yuan / ton, it is expected to bring nearly 500 million yuan of investment income to Wuxi Shangji Automation Co.Ltd(603185) in 2022). Granular silicon is a major technological innovation, and the cost will be greatly reduced. In the future, granular silicon + CCZ is expected to reduce the cost by 20-30%.
At present, the company’s silicon wafer business is slightly single, and the photovoltaic industry is ten times larger than the track in the past ten years. We don’t think we can rule out cultivating new growth points
At present, the company’s silicon wafer business is slightly single. When the industry fluctuates violently, the anti risk ability needs to be further improved. We believe that the company’s granular silicon project is an attempt to extend the industrial chain. In the ten times larger track of photovoltaic in the next decade, the company does not rule out the possibility of further extending the industrial chain. Previously, the company has announced that it plans to expand its business scope to electronic special materials, semiconductor equipment, etc.
Investment suggestions: high growth and low value; It will play an important strategic role in the large silicon wafer and granular silicon industry in the future
The company’s integrated business layout of “silicon wafer + granular silicon + nano silicon” is expected to have a net profit of RMB 1.73/4.7 billion from 2021 to 2023, with a year-on-year increase of 220% / 82% / 52%, and PE of 26 / 14 / 9 times. Maintain the “buy” rating.
Risk tip: the sharp expansion of production leads to the deterioration of the competition pattern, the price rise of silicon material affects the terminal demand, and the risk of technology iteration.
