\u3000\u3 Guocheng Mining Co.Ltd(000688) 556 Qingdao Gaoce Technology Co.Ltd(688556) )
Performance summary: in 2021, the company achieved a revenue of 1.567 billion yuan, a year-on-year increase of + 109.97%; The net profit attributable to the parent company was 173 million yuan, a year-on-year increase of + 193.38%; Deduct non net profit of 173 million yuan, a year-on-year increase of + 302.87%; The company’s revenue in the first quarter of 22 was 556 million yuan, a year-on-year increase of + 103.06%; The net profit attributable to the parent company was 97 million yuan, a year-on-year increase of + 173.28%; Deduct non net profit of 97 million yuan, a year-on-year increase of + 244.19%, eps0.5% 6 yuan, the performance exceeded expectations.
The production of silicon wafer has been expanded aggressively, and the photovoltaic silicon wafer cutting equipment has maintained a high landscape. In 2021, the company’s revenue of photovoltaic silicon wafer cutting equipment was 980 million yuan, a year-on-year increase of + 117%; The sales volume was 1021 units, with a year-on-year increase of + 140%. The average price of a single silicon wafer cutting equipment was 960000, a year-on-year increase of – 9.7%; The cost of raw materials rose, and the cost of a single unit was 660000, a year-on-year increase of – 2.4%, so the gross profit margin decreased 5pct to 31%.
The production capacity of Vajra line has been increased to more than 25 million kilometers, and the production and sales have been greatly improved. In 2021, the company improved its production capacity through the technical transformation of “single machine and twelve lines”, and the sales volume of photovoltaic diamond lines was 8.3 million kilometers, with a year-on-year increase of 80.5%; The annual average price was 35 yuan / km, a year-on-year decrease of 24%. Thanks to the scale effect of output increase, the unit labor and manufacturing cost of diamond line decreased by 52% / 31% year-on-year, and the unit material also decreased by 25%. To sum up, the gross profit margin of photovoltaic diamond wire has increased 5pct to 36% as a whole. We estimate that the net profit per kilometer of diamond wire is about 7 yuan. After the completion of technical transformation, the company’s diamond line production capacity will be increased to more than 25 million kilometers, and the shipment of diamond line will continue to increase rapidly in 2022.
Slice profit exceeded expectations. In 2021, the company’s slicing revenue is 105 million yuan, and it is expected to ship 1GW, with a net profit of about 0.006 yuan. 22q1 company has a slice revenue of 138 million yuan and a net profit of about 22 million yuan. We expect the net profit per GW slice to be about 17 million yuan. With the slicing and production of the project, there is still room for improvement. We expect that the company will ship 1.2 billion slices in 21 years, contributing a profit of about 150 million yuan.
Continuous breakthroughs in innovative business. In 2021, the company achieved a breakthrough in innovative business, with equipment and diamond line revenue of 105 million yuan, a year-on-year increase of + 323%. Year on year sales of equipment + 600%; The sales volume of diamond line was 620000 km, a year-on-year increase of + 234%. The profitability of innovative business is stronger. In 2020, the unit price of diamond line is 100 yuan / km, and the gross profit margin is 58%. The price and profit decreased in 2021, but it is still better than photovoltaic diamond line.
Profit forecast and investment suggestion: as the leader of cutting and consumables, the company has prominent advantages under the trend of large-size wafer. The net profit of the parent company is expected to be 112% in the next three years.
Risk warning: the risk that the global PV installation demand is less than expected; The risk that the downstream silicon wafer expansion is less than expected; The risk of rising raw material costs and declining profitability of the company; Risks of policy changes.
