\u3000\u3 China Vanke Co.Ltd(000002) 245 Jiangsu Azure Corporation(002245) )
2022q1 performance met expectations and maintained the “buy” rating
In 2022q1, the company achieved a revenue of 1.84 billion yuan, a year-on-year increase of + 25.7% and a month on month decrease of 4.8%; The net profit attributable to the parent company was 200 million yuan, a year-on-year increase of + 25.4% and a month on month increase of + 21.3%; The net profit deducted from non parent company was 142 million yuan, with a year-on-year increase of – 6.3% and a month on month increase of + 12.0%. The performance was in line with expectations. We maintain the previous profit forecast. It is estimated that the operating revenue from 2022 to 2024 will be 95.48/136.9018616 billion yuan, the net profit attributable to the parent company will be 1.062/16.102264 billion yuan, and the EPS will be 1.03/1.55/2.19 yuan. The current share price corresponds to 18.4/12.1/8.6 times of PE from 2022 to 2024, maintaining the “buy” rating.
Zhangjiagang phase II production capacity release increased the scale of revenue, and the rise in raw material prices affected the gross profit margin
Revenue in the first quarter was + 25.7% year-on-year, mainly due to the climbing contribution of Zhangjiagang phase II production capacity. Zhangjiagang phase II project was put into operation in 2021q4, and the lithium battery production capacity continued to increase in the first quarter. The gross profit margin of 2022q1 company was 17.5%, down 0.5 percentage points month on month, with a year-on-year decrease of 2.7pcts. It was mainly affected by the rise in the price of raw materials, and the price of lithium battery raw materials represented by lithium carbonate continued to rise. The expenses were well controlled. The rate of sales, management, R & D and financial expenses in the first quarter was 8.1%, down 0.2 percentage points from 8.3% in the fourth quarter of 2021.
The decline of logistics efficiency affects the company’s shipment
The inventory at the end of 2022q1 was 1.848 billion yuan, an increase from 1.533 billion yuan at the beginning of the period. The inventory turnover days were 100.3 days, up from 81.1 days in 2021q1 and 82.4 days in 2021q4. The increase in inventory and inventory turnover days is partly due to the decline in logistics efficiency after the epidemic in East China. The net operating cash flow changed greatly, with a net outflow of 16.54 million yuan in 2022q1 and an inflow of 348 million yuan in the same period in 2021, mainly due to the increased procurement in 2022q1 and the impact of the use of some bills.
Actively expand production and seize the market share of cylindrical battery
The company is the only small power battery supplier in China that has fully entered the supply chain of the global top5 power tool company. The company actively expands production and complies with the localization trend of cylindrical batteries. In 2022, the company’s output is expected to reach 700 million. In 2022q4, the first phase of Huai’an plant is expected to be put into operation. After reaching the production capacity, the company’s production capacity will reach 1.25 billion.
Risk warning: risk of raw material price rise; Risk of delaying the progress of capacity climbing; The epidemic affects China’s demand; The conflict between Russia and Ukraine continues to affect the demand for small cylindrical lithium batteries in the European market.
