\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 141 Hubei Xingfa Chemicals Group Co.Ltd(600141) )
Event:
On April 28, 2022, the company released the first quarterly report of 2022: the operating revenue of Q1 in 2022 was 8.575 billion yuan, an increase of 90.65% year-on-year and 22.03% month on month; The net profit attributable to the parent company was 1.723 billion yuan, a year-on-year increase of 384.07% and a month on month decrease of 2.05%. The net cash flow from operating activities was 1.291 billion yuan, a year-on-year increase of 190.31% and a month on month decrease of 51.36%. The weighted average return on net assets was 11.66%, an increase of 8.04 percentage points year-on-year and a decrease of 2.19 percentage points month on month. The gross profit margin was 35.91% (a year-on-year increase of 14.15 percentage points and a month on month decrease of 7.42 percentage points), and the net profit margin was 24.72% (a year-on-year increase of 16.16 percentage points and a month on month decrease of 3.58 percentage points).
Key investment points:
The prosperity of products remained high, and the company’s operating performance increased steadily
In 2022, Q1 achieved an operating revenue of 8.575 billion yuan, an increase of 90.65% year-on-year and 22.03% month on month; The net profit attributable to the parent company was 1.723 billion yuan, a year-on-year increase of 384.07% and a month on month decrease of 2.05%. In the first quarter of 2022, the prosperity of phosphorus chemical products remained high, the prices of the company’s main products increased significantly, and the company’s revenue and profit increased significantly year-on-year. In Q1 2022, the average sales price of phosphate rock of the company was 377.29 yuan / ton, with a year-on-year increase of 89.87% and a month on month decrease of 4.16%; The average selling price of yellow phosphorus was 2899779 yuan / ton, with a year-on-year increase of 96.76% and a month on month decrease of 18.94%; The average sales price of fine phosphate was 1162372 yuan / ton, with a year-on-year increase of 45.02% and a month on month decrease of 13.86%; The average sales price of ammonium phosphate was 340363 yuan / ton, with a year-on-year increase of 50.37% and a month on month decrease of 7.03%; The average selling price of silicone was 2761891 yuan / ton, with a year-on-year increase of 44.88% and a month on month decrease of 4.67%; The average sales price of glyphosate was 6658992 yuan / ton, with a year-on-year increase of 202.41% and a month on month increase of 54.16%.
The gross profit margin of the company’s sales in the first quarter was 35.91%, down 7.42 percentage points month on month; The net profit margin on sales was 24.72%, down 3.58 percentage points month on month. The month on month decrease in gross profit margin and net profit margin is mainly due to the fact that since the first quarter of 2022, on the one hand, the average sales price of the company’s main products such as yellow phosphorus, phosphate and ammonium phosphate has decreased year-on-year, on the other hand, the price of the company’s main raw materials such as sulfur and sulfuric acid has increased significantly. According to wind data, in Q1 2022, the average price of sulfur was 2788 yuan / ton, an increase of 33.29% month on month; The average price of phosphate rock was 620 yuan / ton, unchanged month on month.
In Q1 2022, the company’s sales expense ratio was 0.98%, a year-on-year decrease of 3.02 percentage points and a month on month increase of 1.16 percentage points; The management expense ratio was 0.78%, a year-on-year decrease of 0.57 percentage points and a month on month decrease of 1.24 percentage points; The financial expense ratio was 1.15%, a year-on-year decrease of 1.67 percentage points and a month on month decrease of 0.53 percentage points.
Further extend the new energy industry chain and expand the silicone industry cluster
On March 22, 2022, the company announced that the total amount of funds raised by the company to issue convertible bonds would not exceed RMB 2.8 billion, of which RMB 1.27 billion would be used for the construction of 200000 t / a iron phosphate and supporting 100000 t / a wet process phosphoric acid refining technology transformation project, RMB 757 million would be used for the construction of 80000 T / a functional silicone rubber project, and RMB 773 million would be used to repay bank loans. The company has abundant phosphate rock resources, 700000 T / a wet process phosphoric acid plant, 100000 t / a wet process refined phosphoric acid plant (the project will increase the production capacity to 150000 tons through technical transformation), 400000 T / a liquid ammonia plant and 80000 T / a hydrogen peroxide plant. The construction of iron phosphate project is conducive to give full play to the existing industrial chain synergy advantages, raw material supply guarantee advantages and fine chemical technology advantages, and enhance the market competitiveness of the company’s products, Improve the production and operation efficiency of the company. At present, the company has formed a production capacity of 360000 T / a silicone monomer, 80000 T / a 110 silicone rubber, 70000 T / a 107 silicone rubber, 30000 T / a sealant and 20000 t / a silicone oil. The subsidiary Inner Mongolia Xingfa is building a 400000 T / a silicone monomer project. After the completion of the project, the annual production capacity of the company’s silicone monomer will reach 760000 tons, ranking in the forefront of the industry. After the 80000 T / a functional silicone rubber project is completed, it will further expand the silicone industry cluster and further improve the added value of the company’s products.
Acquire 51% equity of Xingxing Lantian and improve the phosphate fertilizer industry chain
On April 29, 2022, the company announced that Yidu Xingfa, a wholly-owned subsidiary of the company, signed the equity transfer agreement with Yichang Xingfa, the controlling shareholder of the company. Yidu Xingfa plans to purchase 51% equity of xingxinglantian held by Yichang Xingfa with its own capital of 25900 yuan. After the completion of this transaction, the company will hold 100% equity of xingxinglantian, and xingxinglantian will become a wholly-owned subsidiary of the company. In 2021, Xingxing Lantian 400000 T / a synthetic ammonia project was successfully started at one time. Synthetic ammonia is an important raw material for the production of phosphate fertilizer. This acquisition is conducive to improving the company’s phosphate fertilizer industry chain and further enhancing the guarantee capacity of raw materials.
Profit forecast and investment rating: Based on the principle of prudence, the impact of convertible bond issuance on the company’s performance is not considered temporarily. It is estimated that the net profit attributable to the parent company in 2022, 2023 and 2024 will be 6.352, 7.055 and 7.779 billion yuan respectively, and the corresponding PE will be 5.52, 4.97 and 4.51 times respectively, maintaining the “buy” rating.
Risk warning: macroeconomic fluctuation risk; The production capacity is lower than expected; Risk of price fluctuation of raw materials; Future demand decline; The progress of the new project is less than expected; Uncertainty in the issuance process of convertible bonds.
