\u3000\u30 China Baoan Group Co.Ltd(000009) 32 Hunan Valin Steel Co.Ltd(000932) )
Event: in 2021, the annual revenue was 171176 billion yuan, a year-on-year increase of + 47.22%, and the net profit attributable to the parent company was 9.680 billion yuan, a year-on-year increase of + 51.36%. After deduction, the net profit attributable to the parent company was 9.574 billion yuan, a year-on-year increase of + 50.18%; In 2021q4, the revenue was 35.952 billion yuan, a month on month ratio of – 28.63%, a year-on-year increase of + 7.82%, and the net profit attributable to the parent company was 1.916 billion yuan, a month on month ratio of – 12.47%, a year-on-year increase of + 22.98%. The net profit attributable to the parent company after deduction was 1.845 billion yuan, a month on month ratio of – 15.00%, a year-on-year increase of + 18.73%; In 2022q1, the revenue was 40.963 billion yuan, a month on month increase of + 13.94% and a year-on-year increase of + 6.13%; The net profit attributable to the parent company was 2.111 billion yuan, a month on month increase of + 10.18%, a year-on-year increase of + 2.78%, and the net profit attributable to the parent company after deduction of non profit was 2.049 billion yuan, a month on month increase of + 11.06%, a year-on-year increase of + 0.12%.
The transformation of the product structure to “special steel” was accelerated, and the net profit attributable to the parent company in 2022q1 reached a new high in the same period: the sales volume of the company’s variety steel increased continuously in 2021, accounting for 55%, with a year-on-year increase of + 3PCT. The net profit attributable to the parent company in 2021 reached a record high, and the net profit attributable to the parent company in 2022q1 reached a new high in the same period.
In 2021, the company’s steel sales volume was + 2.47% year-on-year, and the gross profit per ton of steel was + 17.86% year-on-year; in 2021, the company’s steel sales volume was 25.75 million tons, with a year-on-year increase of 2.47%, and the corresponding average price of steel was 5542 yuan / ton, with a year-on-year increase of 34.22%, and the gross profit per ton of steel was 774 yuan, with a year-on-year increase of +.
The subsidiary hualinglian steel silicon steel phase I project is planned to start in June 2022: the subsidiary hualinglian steel plans to build a new phase I project of cold rolled silicon steel products in June 2022. The first step is expected to take 18 months, and it is expected to achieve an annual output of 200000 tons of non oriented silicon steel, 100000 tons of non oriented silicon steel cold hard coil and 90000 tons of oriented silicon steel cold hard coil; In the second step, the planned construction period is 14 months, which is expected to ensure that the phase I project will achieve an annual output of 400000 tons of non oriented silicon steel, 200000 tons of non oriented silicon steel cold hard coil and 180000 tons of oriented silicon steel cold hard coil.
Hunan Iron and Steel Group added 1 billion yuan to Valin Henggang to help its technological and environmental transformation. Benefiting from the increase of oil and gas exploitation activities, the demand for seamless steel pipes has gradually improved. Valin Henggang, a wholly-owned subsidiary of the company, is one of the three professional seamless steel pipe manufacturers in China. During the “14th five year plan” period, it will increase capital investment in the fields of quality and efficiency improvement, intelligent manufacturing, energy conservation and environmental protection. It plans to invest in the construction of production line upgrading, intelligent transformation of centralized control system, ultra-low emission transformation and other projects, actively promote the upgrading of variety structure and digital intelligent transformation, and accelerate the realization of ultra-low emission. Hunan Iron and Steel Group, the controlling shareholder, plans to increase capital by 1 billion yuan to Valin Henggang to help it improve its voice in the industrial chain, and highlight the controlling shareholder’s support and confidence in the development of the company.
Profit forecast, valuation and rating: affected by the rising cost of the industry, we lowered the net profit attributable to the parent company by 11.54% and 14.17% to 9.224 and 9.414 billion yuan from 2022 to 2023, with corresponding EPS of 134 and 1.36 yuan respectively. The profit forecast of the new company in 2024 is 9.726 billion yuan, with corresponding EPS of 1.41 yuan. Hunan Valin Steel Co.Ltd(000932) as a leading iron and steel enterprise, the subsequent product structure is expected to continue to improve. We maintain the “overweight” rating of the company.
Risk warning: the price of raw materials has risen sharply; The downstream demand for steel fell sharply.
