\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 012 Longi Green Energy Technology Co.Ltd(601012) )
Event: the company released the annual report of 2021. In 2021, the operating revenue was 80.932 billion yuan, a year-on-year increase of 48.27%, and the net profit attributable to the parent company was 9.086 billion yuan, a year-on-year increase of 6.24%; The net profit attributable to the parent company in 2021q4 was 1.53 billion yuan, a year-on-year decrease of 30.33%, mainly due to the company’s single quarter impairment of 934 million yuan, while the single quarter impairment in 2020q4 was 406 million yuan; The company also released the first quarterly report of 2022. In 2022q1, the operating revenue was 18.595 billion yuan, a year-on-year increase of 17.29%, and the net profit attributable to the parent was 2.664 billion yuan, a year-on-year increase of 6.46% and a month on month increase of 74.12%.
In 2021, the company took the lead in silicon wafer shipment and component sales, but the profit was slightly damaged due to the high price of silicon material. In 2021, the company achieved 70.01gw of monocrystalline silicon wafer shipments, including 33.92gw for external sales and 36.09gw for self use; The silicon wafer business achieved an operating revenue of 17.028 billion yuan and a unit revenue of 0.50 yuan / W, which was basically the same as that of 0.49 yuan / W in 2020; However, due to the high price of silicon material, even if the non silicon cost of the whole process of silicon wafer in 2021 decreased by 7% compared with that in 2020, the gross profit margin of silicon wafer still decreased by 2.81 PCT to 27.55%. In 2021, the company delivered 38.52gw of single crystal components, including 37.24gw for external sales, a year-on-year increase of 55.45% and 1.28gw for self use. The operating revenue of the company’s component business is 58.454 billion yuan, and the unit revenue is 1.59 yuan / W, slightly higher than 1.51 yuan / W in 2020; However, the gross profit margin decreased by 3.47 PCT to 17.06%. By the end of 2021, the company’s single crystal silicon wafer production capacity has reached 105gw, single crystal battery production capacity has reached 37gw, and single crystal component production capacity has reached 60GW. The inventory turnover days in 2021 are 6.8 days less than those in 2020.
The shipment of 2022q1 integrated components was slightly lower than expected, and the profit rebounded slightly. In 2022q1, the company realized the shipment volume of monocrystalline silicon wafer of 18.36gw, including 8.42gw for external sales and 9.94gw for self use. The gross profit margin of silicon rod and silicon wafer was 23.24%; The shipment volume of single crystal components is 6.44gw, including 6.35gw for external sales and 0.09gw for self use. The gross profit margin of integrated components is 19.27%. The company expects to ship 90-100gw of monocrystalline silicon wafer (including self use) and 50-60gw of components (including self use) in 2022. At the same time, the company actively speeds up the industrial application and capacity construction of new battery technology. Taizhou Leye’s annual output of 4gw single crystal battery project is expected to be put into operation in August 2022, and Xixian Leye’s annual output of 15gw high-efficiency single crystal battery project is expected to be put into operation in September 2022. The company is expected to maintain the advantage of product differentiation in the battery sector.
Maintain the “buy” rating: according to the company’s subsequent capacity planning, we maintain / increase / introduce the profit forecast for 22-24 years. It is expected that the company will realize the net profit attributable to the parent company of RMB 14.586/18.90/21.939 billion in 22-24 years (maintain / increase by 5% / increase), corresponding to eps2.5% 69 / 3.36/4.05 yuan. The current share price corresponds to 23 / 18 / 15 times of PE in 22-24 years. The high outlook of the photovoltaic industry continues. As the leading supplier of monocrystalline silicon wafers and the industry leader in profitability, the company adopts the globalization strategy, and the future module shipment is expected to remain the first in the industry. In addition, emerging businesses such as BIPV and hydrogen energy will open up the company’s future growth space and maintain the “buy” rating.
Risk tip: the demand for overseas photovoltaic installation is not expected due to geopolitical factors; The competition pattern of silicon wafer links intensifies to a sharp decline in profitability.
