\u3000\u30003 China Railway Special Cargo Logistics Co.Ltd(001213) 00121)
Event:
On April 28, 2022, the company released its report for the first quarter of 2022: the company achieved an operating revenue of 855 million yuan in Q1, a year-on-year increase of 42.24% and a month on month increase of 14.37%; The net profit attributable to the parent company was 114 million yuan, an increase of 28.21% year-on-year and 200.33% month on month; The net profit attributable to the parent company after non deduction was 114 million yuan, an increase of 30.37% year-on-year and 226.92% month on month; The net cash flow from operating activities was 54 million yuan, an increase of 42.07% year-on-year and 184.74% month on month; The net interest rate was 13.28%, a year-on-year decrease of 1.45 percentage points and a month on month increase of 8.23%.
Key investment points:
The net profit attributable to the parent company increased significantly month on month, and the profitability of high-performance varieties increased steadily
The company achieved an operating revenue of 855 million yuan in Q1 of 2022, with a year-on-year increase of 42.24% and a month on month increase of 14.37%; The net profit attributable to the parent company was 114 million yuan, an increase of 28.21% year-on-year and 200.33% month on month; The main reason for the significant increase in the net profit attributable to the parent company is that in recent years, the company has adhered to scientific and technological innovation and continuously enriched its varieties. During the reporting period, the profitability of processing system additives and some high-end high-performance varieties has increased steadily. At the same time, it has actively expanded the development and certification of green rubber additives by customers, made good progress, and the net profit level has increased year-on-year.
Increase R & D investment and build core competitiveness
In 2022, the overall development and operation of Q1 company were stable and good. In 2022, the sales expense rate of Q1 company was 1.48%, a year-on-year decrease of 1.01 percentage points and a month on month decrease of 0.66 percentage points; The management fee rate was 5.15%, with a year-on-year increase of 1.75 percentage points and a month on month increase of 0.11 percentage points; The financial expense rate was 1.01%, with a year-on-year increase of 0.18 percentage points and a month on month decrease of 0.43 percentage points; At the same time, the company’s R & D expenses were 32 million, a year-on-year increase of 237.76% and a month on month decrease of 13.09%. On the whole, Q1 cost control in 2022 is relatively excellent, and the company continues to increase R & D investment.
The 40000 ton continuous method insoluble sulfur project is expected to contribute to the company’s profit
In recent years, the company has formed a number of core technologies through continuous technological breakthrough. The successful research and development of the new green process of accelerator M and NS has solved the three wastes problem that has been perplexing the accelerator industry. Environmental friendly homogenizer, high thermal stability and high dispersion insoluble sulfur of continuous process, pk900, TBSI and other products have been successfully localized, breaking the monopoly of foreign technology and building a new performance growth point for the company. At present, the company is the third company to master the industrialization technology of continuous insoluble sulfur after Eastman and Shikoku Chemical Co., Ltd. of Japan, and its product competitiveness has been fully recognized by the market; In 2022, the company will accelerate the production of 40000 tons of continuous insoluble sulfur project as soon as possible, and is optimistic about the incremental contribution to the company’s profits after the production.
Investment rating and Valuation: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 454 million, RMB 554 million and RMB 695 million respectively, corresponding to 7, 6 and 5 times of PE, maintaining the “buy” rating.
Risk tip: the competitor has made a breakthrough in the continuous process of insoluble sulfur; Slow progress of new projects; Risk of shutdown of the plant due to force majeure; The risk of falling product demand caused by macroeconomic fluctuations; Risk of rising costs and sharp decline in product prices; The risk of untimely transformation of R & D achievements, the risk of return of accounts receivable, the risk of external guarantee, and the risk of implementation of investment projects with raised funds.
