\u3000\u30 Beijing Jingyeda Technology Co.Ltd(003005) 99 Guangdong Xiongsu Technology Group Co.Ltd(300599) )
Key investment points
Event: the company released the 2021 annual report and the first quarterly report of 2022. In 2020, the revenue reached 2.358 billion yuan, a year-on-year increase of + 13.96%; The net profit attributable to the parent company was 111 million yuan, a year-on-year increase of - 47.74%. 22q1 achieved a revenue of 478 million yuan, a year-on-year increase of + 1.33%; The net profit attributable to the parent company was 7.37 million yuan, a year-on-year increase of - 83.18%.
The growth rate of income in 21q4 and 22q1 slowed down, and the municipal PE pipeline developed rapidly. Quarter by quarter, the company's Q1-Q4 revenue growth rate in 2021 was 50.55% / 6.56% / 22.39% / - 4.60% respectively, and the 22q1 revenue growth rate was 1.33%, mainly due to the impact of the epidemic and the boom of industry demand. The growth rate of 21q4 and 22q1 was relatively slow. In terms of products, the growth rate of PVC / PPR / PE pipeline revenue in 21 years was 10.52% / 0.11% / 36.54% respectively. In 2021, the company focused on increasing the investment in municipal pipeline business, and the growth rate of municipal PE pipeline was significantly higher than the overall growth rate.
Affected by the rising price of raw materials, the gross profit margin is under pressure. In 2021, the gross profit margin of PVC / PPR / PE pipes decreased by 8.45/1.46/5.99 percentage points year-on-year respectively, mainly due to the sharp fluctuation of raw material prices. In 2021, the company's net profit margin on sales was 4.71%, with a year-on-year change of -5.56pct. In addition to the impact of raw material price fluctuation, 1) the company has accrued 8.92 million yuan of asset impairment loss and 6.68 million yuan of credit impairment loss; 2) The corporate income tax rate was 9.58% in 2021 and 17.59% in the same period in 2020.
The operating cash flow is under short-term pressure, and the asset liability ratio remains at a low level. The net cash flow from operating activities of the company in 2021 was 05 million yuan, a year-on-year change of - 281 million yuan. At the end of the period, the balance of accounts receivable and notes receivable of the company was 277 million yuan, with a year-on-year increase of 58.19%. At the end of 2021, the company's asset liability ratio was 21.45%, with a year-on-year decrease of 1.47 percentage points. 22q1 net cash flow from operating activities was - 55.31 million yuan, a year-on-year decrease of 596.48%, mainly due to the increase in cash paid for purchasing goods and receiving labor services in the current period.
Profit forecast and investment rating: as a leader in the plastic pipeline industry in South China, the company benefits from the improvement of downstream real estate concentration, the extension of residential warranty period and the promotion of multiple policies at the infrastructure end to stimulate the demand for plastic pipes, and the market share is expected to continue to increase. The company focuses on promoting municipal pipeline business and continuously developing new municipal pipeline products, and the proportion of PE pipeline continues to increase. It is expected that with the expansion of the company's municipal business and the continuous production of new production capacity, as well as the subsequent merger and acquisition of Kangtai plastic, the scale effect of production capacity will be further improved. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be 160 / 210 / 266 million yuan respectively, and the corresponding PE will be 19x / 14x / 11x respectively. Considering the company's future capacity increase and the expectation of restructuring, we will cover it for the first time and give it a "overweight" rating.
Risk tips: downstream infrastructure and real estate industry fluctuation risk, raw material price fluctuation risk, industry competition risk, and the capacity release of newly-built and put into operation projects is less than expected.
