\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 160 Zhejiang Juhua Co.Ltd(600160) )
Key elements of the report:
On the evening of April 28, Zhejiang Juhua Co.Ltd(600160) released the report of the first quarter of 2022. The company achieved revenue of 4.608 billion in Q1 of 2022, with a year-on-year increase of 28.07%; The net profit attributable to the shareholders of the listed company was 234 million, a year-on-year increase of 1880%; The basic earnings per share was 0.087 yuan, a year-on-year increase of 2075%.
Key investment points:
The price of main products increased steadily, and the short-term disturbance of the epidemic did not change the company’s long-term profit elasticity: the company achieved a revenue of 4.608 billion in Q1 2022, a year-on-year increase of 28.07%; The net profit attributable to the shareholders of the listed company was 234 million, with a year-on-year increase of 1880%, and the performance basically met the expectations. In terms of price, the average prices of fluorine chemical raw materials, refrigerants and fluoropolymer materials in the first quarter of 2022 were 5513, 23429 and 69023 yuan / ton respectively, with a year-on-year increase of 46.49%, 52.38% and 40.38%; Up 1.76%, – 2.25% and 0.59% month on month. It can be seen that although the price of the company’s main products has declined from the highest point in 2021q4, it shows a steady upward trend on the whole. In terms of sales volume, the sales volume of fluorochemical raw materials and fluoropolymer materials outside Q1 in 2022 were 71000 tons and 9000 tons respectively, with a positive growth of 8.66% and 10.17% year-on-year, while the sales volume of refrigerants, fluorofine chemicals, petrochemical materials, basic chemical products and other businesses decreased, with a decrease of – 13%, – 80%, – 8% and – 16% respectively. The decline in sales was due to the outbreak in the company’s location in mid March. Although the company achieved zero infection of employees and safe production under good management, the logistics was blocked, resulting in the inability of the company’s products to be transported abroad; In terms of expenses, the sales expenses, management expenses and financial expenses in 2022q1 were 50 million, 21.247 million and 4.54 million respectively, an increase of 27.93 million, 56.98 million and 8.04 million year-on-year. The impairment loss of assets in 2022q1 is – 51.01 million. We expect that the increase of various expenses is due to the increase of the impact of the epidemic. In the long run, we believe that the refrigerant presents a marginal upward trend, superimposes the cost advantages brought by the company’s high integration, and is optimistic about the company’s future development.
The R & D expenses increased significantly and accelerated the layout of the company’s projects: the company attached great importance to R & D investment, which increased year by year. In the single quarter of Q1 2022, it reached 360 million, an increase of 221% year-on-year and 30% month on month. The continuous high proportion of R & D investment is conducive to ensuring the company’s competitive advantage in the industry and promoting the company’s subsequent PVDF projects, fluoropolymers and other projects. The company has many projects under construction, including 8.55kt/a suspension PTFE technical transformation project, 10.1kt/a PTFE capacity expansion project, 7kt / a fluororubber technical transformation project, 10kt / a PVDF project phase II, 48kt / a VDF technical transformation and expansion project, 5000 t / a giant core coolant project, 75000 T / a epichlorohydrin project and 400kt / a monochloromethane capacity expansion project, We believe that the company will gain a leading edge in the follow-up competitive market by virtue of the technical experience accumulated in fluorine chemical industry for many years and the scale effect brought by capacity expansion.
Profit forecast and investment suggestions: the company is expected to realize a net profit attributable to the parent company of RMB 1.642/19.56/2.203 billion from 2022 to 2024, with a corresponding PE of 17.94/15.06/13.37 (corresponding to the closing price of RMB 10.91 on April 28), maintaining the “buy” rating.
Risk factors: the price of refrigerant and its raw materials fluctuates greatly; Risk that refrigerant demand is less than expected; Risk that the production progress of PVDF under construction is less than expected; The risk of epidemic aggravation.
