\u3000\u3 Guocheng Mining Co.Ltd(000688) 779 Hunan Changyuan Lico Co.Ltd(688779) )
Event: the company released the first quarterly report of 2022, realizing a revenue of 3.393 billion yuan, a year-on-year increase of 179.31%; The net profit attributable to the parent company was 304 million yuan, a year-on-year increase of 163.75%; Net profit deducted from non parent company was RMB 277 million, with a year-on-year increase of 151.73%.
Comments:
Profitability is steadily improving. In 2022q1, the company's profitability was good, with a gross profit margin of 15.60%, a month on month increase of + 1.62pct, a significant increase in R & D expenses, a net profit margin of 8.96%, a month on month decrease of -0.31pct, a net profit margin of 8.16% after deducting non attributable parent company, and a month on month increase of -0.9pct. The profitability was better.
New production capacity is gradually released, which is expected to contribute to profits. The production capacity of 40000 tons in the first phase of the expansion of the company's automotive lithium battery cathode is gradually released. It is expected that the shipment volume in Q1 will increase month on month. It is expected that the production capacity of ternary cathode will reach 120000 tons and the production capacity of lithium iron phosphate will reach 60000 tons by the end of 22, and continue to maintain the first echelon level of the industry.
Cost reduction and efficiency increase continue to be carried out, which is expected to bring excess returns to the company in the future. In 2021, the company launched a new generation of 65 series high-voltage single crystal cobalt reduction products and low cobalt ni83 single crystal products, and promoted cost reduction and efficiency enhancement in terms of high nickel product yield, oxygen reduction and precursor single kettle capacity improvement. The scale advantage of the high-tech base shows that the investment per ton in the second phase of the expansion of automotive lithium battery production has decreased by 9%, and the cost competitiveness of the company is expected to continue to improve.
Profit forecast and investment rating: we expect the company's revenue from 2022 to 2024 to be 15.93 billion yuan, 21.53 billion yuan and 23.2 billion yuan respectively, with a year-on-year increase of 132.8%, 35.2% and 7.8%; The net profit attributable to the parent company was 1.373 billion yuan, 1.952 billion yuan and 2.502 billion yuan respectively, with a year-on-year increase of 95.9%, 42.2% and 28.2%. The current share price corresponds to 20.97 and 14.75 times of PE from 2022 to 2023 respectively, maintaining the "buy" rating.
Risk factors: the production capacity launch process is less than expected, the price of raw materials fluctuates sharply, and the sales volume of new energy vehicles is less than expected.
