\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Key investment points
Event: Shandong Sun Paper Co.Ltd(002078) released the first quarterly report of 2022. In the first quarter of 2022, the company achieved a revenue of 9.667 billion yuan, a year-on-year increase of 26.5%; The net profit attributable to the parent company was 675 million yuan, down 39.1% year-on-year; The non net profit deducted was 658 million yuan, a year-on-year decrease of 39.2%.
Production capacity was fully released and revenue growth was beautiful. Since the second half of last year, the production lines of phase I of Guangxi Beihai “Forest Pulp paper integration” project have been put into operation successively: the cultural paper project with an annual output of 550000 tons was put into trial production in September, the PM5 project with an annual output of 120000 tons of household paper and the chemical mechanical pulp project with an annual output of 200000 tons were put into trial production in October, and the chemical pulp project with an annual output of 800000 tons was put into trial production in December. With the full operation of Guangxi base, the company’s total pulp and paper production capacity has reached 10 million tons, Q1 production capacity has been fully released, and the year-on-year growth rate of revenue is beautiful.
The dark time point has passed, and the Q1 profit margin has improved month on month. 1) On the profit side, the company achieved a gross profit margin of 13.97% in 22q1, a year-on-year increase of -9.47pct, + 4.07pct. Month on month; The net interest rate attributable to the parent company was 6.98%, with a year-on-year increase of -7.51pct, Mom + 4.71pct, The profit margin improved significantly month on month. 2) In terms of period expenses, the rates of sales, management, R & D and financial expenses in 22q1 were 0.40% / 2.52% / 1.91% / 1.33% respectively, with a year-on-year increase of + 0.01 / + 0.41 / + 1.00 / – 0.75pct, R & D expenses increased by 164%, financial expenses decreased by 19.2%, the quality of cost investment was improved, and the operation capacity was continuously optimized.
Industry side: the high pulp price superimposes the improvement of supply and demand, and the profit is expected to continue to be repaired. 1) Cultural paper: supply and demand improvement and profit restoration. In the second half of last year, a large number of overseas low-cost paper were imported into China, superimposing the impact of the double reduction policy of education, weakening the supply, demand and price of cultural paper. Looking forward to 2022, under the disturbance of overseas pulp supply, it is expected that the pulp price will fluctuate at a high level, forming cost support, and the marginal contradiction between supply and demand of finished paper will slow down. According to Zhuo Chuang information, on April 28, the average price per ton of double copper paper and double gummed paper was 5620 and 6250 yuan respectively, up 4.27% and 11.36% respectively compared with the beginning of the year. The bottom of ton profit fluctuated. The head paper enterprises with the advantage of pulp and paper integration are expected to take the lead in realizing profit restoration. 2) Wrapping paper: terminal demand boosts construction. The stacking peak season of plastic restriction is reduced, which is expected to boost the terminal demand of carton board. The operating rate of carton board in March was 64.3%, an increase of 8.7pct year-on-year, Increased by 4.8pct. Month on month. 3) Dissolved slurry: the high view continues. On April 28, ccfei offered 8200 yuan for dissolving pulp, which was close to the high of last year, up 22.4% from the beginning of the year. Looking forward to the future, the downstream textile and garment demand is stable, and the high cotton price is expected to support the price of dissolved pulp.
The construction of the three bases has been continuously promoted, the competitive advantage is stable, and the growth path is clear. The layout of the company’s three bases in Shandong, Laos and Guangxi has taken shape, which will further promote the process of capacity construction and industrial chain integration in the future. Nanning base in Guangxi: in March 2022, the company completed the acquisition of Liujing Chengquan in Guangxi (with an annual output of 150000 tons of pulp and 200000 tons of paper), and officially launched the “Forest Pulp integration and supporting industrial park project with an annual output of 5.25 million tons” in Nanning, Guangxi base. The integration of Forest Pulp and paper is further developed, with stable front and rear advantages and clear growth path in the future. Guangxi Beihai base: it is planned to invest 400 million yuan to implement a 150000 ton domestic project, of which the first phase of 100000 ton capacity is expected to be completed and put into operation in the second half of 2022. Shandong Zoucheng base: it is planned to invest 300 million yuan to implement the taiyanghonghe ultra-high strength special paper project with an annual output of 34000 tons, which is expected to be put into operation in the second half of 2022.
Investment suggestion: we expect the company to achieve revenue of RMB 34.59 billion, 37.04 billion and 38.6 billion from 2022 to 2024, with an increase of 8.1%, 7.1% and 4.2% at the same time, realize net profit attributable to parent company of RMB 3.03 billion, 3.22 billion and 3.35 billion, with an increase of 2.6%, 6.0% and 4.0% at the same time, and EPS of RMB 1.13, 1.20 and 1.25, maintaining the “buy” rating.
Risk tips: risks of sharp rise in raw material prices, macroeconomic fluctuations and overseas investment policies
