\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 366 Ningbo Yunsheng Co.Ltd(600366) )
Investment logic
Focus on the development of high-performance Nd-Fe-B.
In the past 20 years, the company stripped off the servo motor business and focused on the development of Nd-Fe-B business. At present, the revenue and gross profit account for more than 90%. In February, the company plans to raise and invest 1.08 billion to build the 15000 ton high-performance Nd-Fe-B blank project in Baotou, which is expected to be put into operation by the end of the year. In 22-23 years, the annual production capacity of neodymium iron boron blanks of the company will reach 19000 tons and 34000 tons respectively.
Good finance and strong cost control ability. In 21 years, the company’s debt ratio (33.2%) was the lowest in the industry, with net interest rate (13.6%), R & D expense ratio (6.2%) and gross profit per ton of neodymium iron boron finished products (114000 yuan) ranking first in the industry; The manufacturing cost per ton decreased by 32000 yuan.
New energy vehicles and industrial motors contribute to the main demand increment, and the tight balance between supply and demand continues. It is estimated that the global demand for high-performance Nd-Fe-B will be 251000 tons in 25 years, and CAGR = 23.8% in 4 years. Among them, the demand for new energy vehicles and industrial motors increased by 8% and 16% respectively from 21 to 25 years. Rare earth raw materials are controlled by the state and have strong supply rigidity. China’s rare earth permanent magnet production accounts for about 90% of the world. The capital threshold and technical barriers of high-end products are high. The leading enterprises are actively expanding production, and the concentration will be further improved. It is estimated that the supply and demand gap of praseodymium and neodymium oxide will be 8400 tons in 22 years and 15000 tons in 25 years. The high level of praseodymium and neodymium oxide price will be highly sustainable after a slight correction.
The proportion of the three downstream revenue in 21 years: 22% for new energy vehicles, 31% for consumer electronics and 47% for industrial applications. 1) New energy vehicles: key expansion areas in the future. The company has entered the supply chain of Byd Company Limited(002594) (first supply), Weilai, Xiaopeng, mainland, Schaeffler, etc; Cooperate with Zhejiang Founder Motor Co.Ltd(002196) , Wolong Electric Group Co.Ltd(600580) , etc. The company’s grain boundary diffusion technology can reduce the amount of heavy rare earth by 60% – 70%, improve performance and reduce cost. 2) Consumer electronics: consolidate advantages and ensure share. The global market share of VCM magnetic steel of the company is 30%; Electro acoustic magnetic steel will strengthen the development of Android mobile phone project; The magnetic steel of mobile phone vibration motor is deeply bound with iPhone. 3) Industrial application: the company is a supplier of CRRC, Shenzhen Inovance Technology Co.Ltd(300124) , Gree Electric Appliances Inc.Of Zhuhai(000651) , Panasonic electric, Mitsubishi Electric and other enterprises. The market share of servo motor continues to increase, major breakthroughs have been made in the market of variable frequency air conditioning and wind power, and the market expansion of industrial energy-saving motor and elevator traction machine has been steadily promoted.
Profit forecast & investment suggestions
It is estimated that the net profit attributable to the parent company in 22-24 years is 542 million yuan, 646 million yuan and 731 million yuan, EPS is 0.55 yuan, 0.65 yuan and 0.74 yuan, and PE is 19 times, 13 times and 11 times. 22.80 times of the target purchase price for the first time, with a PE rating of “22.80 times”.
Risk tips
Risk of price fluctuation of rare earth raw materials; Downstream demand growth is less than expected; RMB exchange rate fluctuation risk, etc.
