\u3000\u3 Shengda Resources Co.Ltd(000603) 338 Zhejiang Dingli Machinery Co.Ltd(603338) )
Event: on April 28, the company released the annual report of 2021 and the first quarterly report of 2022. In 2021, the company achieved a revenue of 4.939 billion yuan, a year-on-year increase of 67.05%; The net profit attributable to the parent company was 884 million yuan, a year-on-year increase of 33.17%; The net profit attributable to the parent company after non deduction was 859 million yuan, a year-on-year increase of 37.28%. The company plans to pay a cash dividend of 3.40 yuan for every 10 shares. In the first quarter of 2022, the company achieved a revenue of 1.253 billion yuan, a year-on-year increase of 48.97%; The net profit attributable to the parent company was 196 million yuan, a year-on-year increase of 15.07%.
The company's revenue maintained rapid growth and its profitability decreased.
(1) in 2021, the company's revenue increased by 67.05% year-on-year, the net profit attributable to the parent increased by 33.17% year-on-year, and the net profit attributable to the parent increased by 37.28% year-on-year after deduction. In the first quarter of 2022, the company's revenue increased by 48.97% year-on-year, and the net profit attributable to the parent company increased by 15.07% year-on-year. The company's revenue maintained rapid growth, and arm products and overseas business grew rapidly.
(2) in 2021, the company's gross profit margin was 29.34%, a year-on-year decrease of 5.57 percentage points; The net interest rate was 17.91%, a year-on-year decrease of 4.55 percentage points; The weighted average return on net assets was 20.89%, with a year-on-year increase of 1.73 percentage points; The sales expense rate / management expense rate / R & D expense rate / financial expense rate were 2.24% / 1.79% / 3.14% / 1.40% respectively, with a year-on-year decrease of 1.13/0.15/0.40/0.17 percentage points respectively. In 2021, the proportion of arm products of the company increased significantly, while the gross profit margin of arm products was low. The change of product sales structure combined with the sharp rise of raw material prices, the increase of sea freight and other factors, the gross profit margin of the company decreased significantly. In the first quarter of 2022, the company's gross profit margin was 29.20%, a year-on-year decrease of 0.83 percentage points; The net interest rate was 15.62%, a year-on-year decrease of 4.60 percentage points.
The company's turnover was 22.5 days in 2021, down from 22.5 days in 2021; The inventory turnover days were 120.10 days, a year-on-year decrease of 11.06 days. In 2021, the company's net cash flow from operating activities was 374 million yuan, a year-on-year decrease of 58.10%. The operating capacity of the company has been gradually improved, and the operating quality is still relatively stable.
Four inflection points resonate, and the company ushers in a new round of business cycle.
(1) overseas markets have ushered in the turning point of recovery, especially in North America. With the gradual normalization of the epidemic in North America and the stimulation of U.S. infrastructure policies, the utilization rate of aerial work platform equipment has gradually increased, and the supply of products in the North American market is in short supply, which will create a good demand environment for China's export of aerial work platforms. In addition, the trend of electrification in the European market is obvious, and the export of Chinese electric products to the European market is expected to increase rapidly.
(2) "double reverse" is gradually implemented, and the company may become the main winner. The US Department of Commerce has announced the final findings of countervailing and anti-dumping investigations on mobile lifting platforms imported from China; The fully applicable "double reverse" tax rate is 43.49%, which has great advantages over the tax rates of other domestic brands such as temporary workers ("double reverse" tax rate 183.44%). The threshold for other domestic brands to enter the U.S. market will be greatly increased; In contrast, with the least pressure, it is expected to deal with it calmly, and its development in the North American market is expected to return to the right track.
(3) the company's product strategy returned overseas, and the overseas business income increased significantly. In 2021, the company's overseas business revenue was 1.979 billion yuan, a year-on-year increase of 149.44%; The proportion of overseas income increased to 41.61%, 13.50 percentage points higher than that in 2020. With the gradual normalization of the overseas epidemic, the overseas market has ushered in a turning point of recovery; The North American market is particularly hot, with products in short supply. The gross profit margin of the company's overseas business is 34.82%, 11.94 percentage points higher than that of China's business; The continuous increase in the proportion of overseas revenue will also play a positive role in improving the overall gross profit margin of the company.
(4) with the implementation of fixed increase, the company enters a new round of production expansion cycle. In 2021, the company's sales revenue of arm products reached 1.646 billion yuan, a year-on-year increase of 191%, accounting for 34.61% of revenue, an increase of 14.57 percentage points over 2020. In 2021, the company sold 3954 arm products, of which the sales of electric arm products accounted for 58.17%. The company has taken arm products as the focus of development and continues to strengthen the promotion and sales of arm products, especially electric arm products; After the completion of the company's fixed increase project (the project with an annual output of 4000 large intelligent high-altitude platforms), the product structure will continue to be optimized, the production capacity will continue to improve, and the high-end market competitiveness is expected to be further enhanced.
Profit forecast: at the current time point, we believe that the company will usher in four inflection points: (1) overseas markets will meet the inflection point of recovery, among which the North American market will have high growth in 2022; (2) "Double anti" is gradually implemented, and the company may become the main winner; (3) The company's product strategy has returned overseas, but the strategic connotation has undergone profound changes; (4) With the implementation of fixed increase, the company has entered a new round of production expansion cycle. However, due to the continuous high price of raw materials, sea freight and other factors, the company's profitability has decreased. We lowered the company's profit forecast. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 1.269 billion yuan, 1.695 billion yuan and 2.122 billion yuan respectively (the value before 2022 and 2023 will be 1.409 billion yuan and 1.832 billion yuan respectively), and the corresponding PE will be 13.50, 10.10 and 8.07 times respectively. Maintain the "buy" rating.
Risk tips: deterioration of overseas trade environment, intensified market competition, sharp fluctuations in raw material prices and shipping costs, promotion of raised investment projects less than expected, performance less than expected, etc.
