\u3000\u3 Shengda Resources Co.Ltd(000603) 612 Sunstone Development Co.Ltd(603612) )
Company events
The company disclosed the annual report of 2021 and the quarterly report of 2022q1: in 2021, the company realized an operating revenue of 9.458 billion yuan (+ 61.65%); The net profit attributable to the parent company was 620 million yuan (+ 189.64%); Net profit attributable to non parent company (+ 14.36 billion yuan after deduction). In 2022q1, the company achieved an operating revenue of 3.185 billion yuan (+ 87.59%); The net profit attributable to the parent company was 158 million yuan (+ 44.21%); The net profit attributable to the parent company after deduction was 155 million yuan (+ 39.29%).
The volume and profit of anode products have increased, and the company’s performance has achieved high growth
1) production volume: in 21 years, the company has completed full capacity operation, helping the production and marketing scale reach a new high. The company achieved a pre baked anode output of 2.069 million tons, a year-on-year increase of + 9.2%, and a product sales volume of 2.0249 million tons, a year-on-year increase of + 5.0%, including an export sales volume of 643000 tons, a year-on-year increase of + 11.6%. 2) Profit: due to the rising price of raw materials and the continuous high profits of the aluminum industry, the price of prebaked anode has increased significantly. It is estimated that during the reporting period, the selling price of the company’s unit products was about 4010.5 yuan / ton, a year-on-year increase of + 48.1%; The gross profit per ton was about 729.5 yuan, a year-on-year increase of + 62.3%; The gross profit margin was 18.2%, up 1.6pct. 3) The price of prebaked anode of 22q1 continued to rise, and the profit growth rate of the company in a single quarter reached 37.41%. During the reporting period, the price of prebaked anode continued to rise. According to SMM data, the average price of prebaked anode of 22q1 was about 5733.3 yuan / ton, a year-on-year increase of + 49.3%. The increase of product price superimposed the advantages of scale, which promoted the continuous improvement of the profitability of the company.
Steadily promote the capacity expansion of prebaked anode and consolidate its leading position
In recent years, the company has actively laid out the southwest market with the opportunity of moving North aluminum to the south, so as to further improve the market share. Phase I Shanghai Pudong Development Bank Co.Ltd(600000) ton project of sotong Yunnan Aluminum was put into operation in 2021q4; Sotong Yunnan Aluminum phase II 300000 ton project was started at the end of 2021 and is expected to be completed and put into operation within 22 years; Sotong Yuheng 350000 ton project is in the process of preparation. By the end of 2021, the company’s pre baked anode operation capacity will reach 2.52 million tons. It is expected that the company will have a capacity of 3.17 million tons in 2022, and the long-term plan is to reach 5 million tons in 2025.
Layout lithium battery cathode carbon materials and open up new growth space
Under the background of double carbon, the company takes “green electricity + new carbon material” as the development direction and officially enters the lithium battery cathode material project. In April 2022, the company announced that it plans to invest 720 million yuan to build the 50000 ton project in the first phase of the 200000 ton lithium ion battery cathode material integration project in Jiabei Industrial Park, with a planned construction period of one year. In addition, the company supports the construction of 770mw photovoltaic green power project to ensure the supply of green energy. After the project is completed and put into operation, the negative carbon material of lithium battery is expected to become the second growth curve of the company.
Investment advice
We expect the company’s revenue from 2022 to 2024 to be RMB 136.8/173.2/20.41 billion respectively, with a year-on-year increase of 44.6% / 26.7% / 17.8%; The net profit attributable to the parent company was 830 / 1060 / 1280 million yuan respectively, with a year-on-year increase of 33.6% / 27.9% / 20.7%; The PE corresponding to the current stock price is 10x, 8x and 6x respectively, maintaining the “buy” rating.
Risk tips
The project is put into operation less than expected, the risk of product price fluctuation, the risk of raw material price fluctuation, etc.
