\u3000\u3 Shengda Resources Co.Ltd(000603) 799 Zhejiang Huayou Cobalt Co.Ltd(603799) )
Company events
The company released the first quarterly report of 2022. In Q1, the company realized an operating revenue of 13.212 billion yuan, a year-on-year increase of 105.66%, a net profit attributable to the parent of 1.206 billion yuan, a year-on-year increase of 84.4%, and a net profit attributable to the parent after deduction of non-profit of 1.19 billion yuan, a year-on-year increase of 80.6%.
The lithium battery business is fast and large-scale, contributing to the company’s performance growth
The price of lithium battery materials is at a high level, and Q1 profit increased year-on-year. 22q1 ternary material 622 has an average market price of 333400 yuan / ton, a month on month increase of + 38%, and ternary precursor 622 has an average market price of 146700 yuan / ton, a month on month increase of + 4.7%. The company actively promotes the release of precursor + cathode capacity. Some production lines of Quzhou 50000 tons of high nickel ternary precursor material project have entered the trial production stage in January this year and are expected to be put into operation in the second half of 22 years; The capacity of Chengdu BAMO cathode material phase III is expected to reach 100000 tons in the middle of the year; The ternary precursor material integration project with an annual output of 100000 tons in BAMO, Guangxi is expected to be put into operation in 23 years. In 2025, the company plans to realize 500000 tons of ternary cathode, 1 million tons of lithium iron phosphate and 1 million tons of precursor. The lithium battery business is expected to drive the high growth of the company’s performance.
The company’s Indonesian nickel project is progressing smoothly and is expected to contribute to performance increment
Huayue project is expected to reach production capacity by the end of June 22; Huafei project is expected to be completed and put into operation in the first half of 23 years; Huake project is expected to be completed in the second half of the year; In addition, the company has reached a strategic cooperation intention with Volkswagen (China) and Qingshan holding group, and plans to build a nickel cobalt hydroxide hydrometallurgy project with an annual output of 120000 tons of nickel metal; Recently, the company signed a cooperation framework agreement with vale Indonesia and plans to cooperate in the construction of a nickel cobalt hydroxide high-pressure acid leaching project with an annual output of no more than 120000 tons of nickel metal. By the end of the year, the company expects to achieve a holding capacity of 225000 gold tons and an equity capacity of 126900 gold tons in the upstream nickel field, which is expected to contribute to a new increase in performance.
It is proposed to implement equity incentive and employee stock ownership plan to promote the long-term development of the company
On April 26, the company issued a restricted stock incentive plan, which plans to grant 11764500 restricted shares to 1412 people, accounting for about 0.96% of the company’s share capital, including 9411600 shares for the first time at a price of 42.35 yuan / share. The employee stock ownership plan was released on the same day, with no more than 287 participants, the upper limit of the number of subject shares is 6.4259 million shares, up to 0.53% of the total existing share capital of the company, and the total amount of funds to be raised initially is no more than 443 million yuan. The implementation of incentive plan can effectively mobilize the enthusiasm of managers and employees, attract and retain excellent talents, and improve the cohesion and competitiveness of the company.
Investment advice
We expect the company’s revenue from 2022 to 2024 to be 49.48/64.55/92.01 billion yuan respectively, with a year-on-year increase of 40.1% / 30.4% / 42.6%; The net profit attributable to the parent company was 5.51/76.5/10.41 billion yuan respectively, with a year-on-year increase of 41.2% / 39.0% / 36.1%; The current share price corresponding to PE is 18x / 13X / 10x, maintaining the “buy” rating.
Risk tips
The production progress of the company’s projects under construction is less than expected, the downstream market demand is less than expected, and the risk of sharp fluctuations in metal prices.
