\u3000\u3 Shengda Resources Co.Ltd(000603) 799 Zhejiang Huayou Cobalt Co.Ltd(603799) )
Key investment points
The company’s net profit attributable to the parent company in Q1 2022 was 1.206 billion yuan, with a month on month ratio of + 84% / – 21%, in line with market expectations. In 2022, Q1 company achieved a revenue of 13.212 billion yuan, an increase of 105.66% year-on-year and 5.52% month on month; The net profit attributable to the parent company was 1.206 billion yuan, a year-on-year increase of 84.4% and a month on month decrease of 21.09%. In terms of profitability, the gross profit margin was 18.47%, down 2.8pct year-on-year and 2.23pct month on month; The net interest rate attributable to the parent company was 9.13%, with a year-on-year decrease of 1.05pct and a month on month decrease of 3.08pct.
The joint venture capacity of ternary precursors is gradually released, and the positive BAMO meter contributes to the increment. At present, the company has a production capacity of 55000 tons of self owned precursors and 45000 tons of joint venture capacity to promote mass production certification. We expect that the company will sell nearly 15000 tons of precursors in Q1 in 2022, which is basically the same month on month. For ternary precursors, we expect that the shipment in 22 years is expected to exceed 100000 tons, an increase of 70% at the same time. In terms of profitability, we expect that the gross profit per ton of 22q1 will be basically maintained, and the gross profit is expected to contribute 150200 million yuan. We expect that the positive pole BAMO will ship 1 Shanghai International Port (Group) Co.Ltd(600018) 000 tons in Q1 in 2022, the production capacity of Chengdu BAMO phase III is expected to reach 100000 tons in mid-22, and 50000 tons of high nickel positive pole will be started in BAMO, Guangxi. We expect that the production capacity of BAMO is expected to exceed 90000 tons in 2022.
The epidemic slightly affected the output of cobalt production line, and copper contributed to stable profits. 1) Cobalt products: we expect the company’s output of Q1 cobalt products to decline by 10-20% due to the epidemic in 2022, with an overall output of 8 Xiandai Investment Co.Ltd(000900) 0 tons. 2) Copper products: we expect the company to produce about 25000 tons in Q1 in 2022, which is basically the same month on month. The annual output is expected to increase slightly to 110000 tons +.
The company’s nickel hydrometallurgy project is progressing smoothly, and Q1 has begun to contribute increment in 2022. We expect the output of 22q1 nickel products to be 4-5000 tons, unchanged month on month. The 60000 ton hydrometallurgy project of Huayue nickel products company was put into operation at the end of the 21st year. We expect that the self-produced nickel resources of 22q1 will contribute 3 Tunghsu Azure Renewable Energy Co.Ltd(000040) 00 tons, and it is expected to realize a net profit of more than 800 million yuan after reaching the production capacity. For the 45000 ton high nickel matte project of Huake, we expect to realize a net profit of more than 400 million yuan to the parent company after it is completed. The company has a nickel smelting capacity of 345000 tons under construction, which will be gradually put into operation from 2022 to 2023. We expect to contribute new performance increment.
It is proposed to launch restricted stock incentive and employee stock ownership plan, which will cover a wide range and effectively improve the company’s long-term competitiveness. On April 26, 2022, the company issued the restricted stock incentive plan (Draft), which plans to grant 11764500 shares of restricted stock to 1412 people, about 0.96% of the company’s share capital, including 9411600 shares for the first time, at a price of 42.35 yuan per share. The maximum number of subject shares of the company’s employee stock ownership plan in 2022 is 6.4259 million shares, up to 0.53% of the company’s total existing share capital. The total amount of funds initially proposed to be raised is no more than 443 million yuan, and the self raised funds of employees are no more than 220 million yuan.
Profit forecast and investment rating: the prosperity of the industry continues. We maintain the company’s net profit attributable to the parent company of RMB 5.725/74.85/9.718 billion from 2022 to 2024, with a year-on-year increase of 47% / 31% / 30%, the corresponding PE is 16x / 12x / 10x, give 25xpe in 2022, the corresponding target price is RMB 117, and maintain the “buy” rating.
Risk tip: the sales volume of electric vehicles is lower than expected, the price of upstream raw materials fluctuates sharply, and there is a risk of floating loss in the open position of hedging.
