\u3000\u3 China Vanke Co.Ltd(000002) 643 Valiant Co.Ltd(002643) )
Event overview
Event 1: on March 26, 2022, the company released its annual report for 2021, achieving an operating revenue of 4.359 billion yuan, a year-on-year increase of 49.36%, a net profit attributable to the parent company of 627 million yuan, a year-on-year increase of 24.16%, and eps0.5% 69 yuan, and the net cash flow from operating activities was 1.045 billion yuan, a year-on-year increase of 87.01%.
Event 2: on April 28, 2022, the company released the first quarterly report of 2022, realizing an operating revenue of 1.371 billion yuan, a year-on-year increase of 74.26%, and a net profit attributable to the parent company of 233 million yuan, a year-on-year increase of 76.67%, eps0.01% 25 yuan, the net cash flow from operating activities was 234 million yuan, a year-on-year decrease of 38.88%.
Analysis and judgment:
The sales volume continued to improve and the performance reached a record high
In 2021, the company achieved an operating revenue of 4.359 billion yuan, a year-on-year increase of 49.36%, and a net profit attributable to the parent company of 627 million yuan, a year-on-year increase of 24.16%, a record high. Affected by the rise of bulk raw materials, the gross profit margin of the company’s products fell 8.39pct to 36.49% year-on-year, and the net profit margin fell 3.06pct to 15.83%. Among them, the operating revenue of functional materials was 2.749 billion yuan, a year-on-year increase of 20.49%, the gross profit was 1.158 billion yuan, a year-on-year increase of 12.98%, and the sales volume was 7129 tons, a year-on-year increase of 11.79%; Big health products achieved an operating revenue of 1.572 billion yuan, a year-on-year increase of 156.17%, a gross profit of 417 million yuan, a year-on-year increase of 50.08%, and a sales volume of 199 tons, a year-on-year increase of 85.98%. The company’s functional materials sector and the big health sector are working together, which is the main reason for the company’s performance growth in 2021.
In 2022, Q1 company achieved an operating revenue of 1.371 billion yuan, a year-on-year increase of 74.26%, and a net profit attributable to its parent company of 233 million yuan, a year-on-year increase of 76.67%. The net profit attributable to its parent company in a single quarter hit a record high. The main reason is that the sales of the company’s functional materials and MP covid-19 antigen rapid detection kit products of overseas subsidiaries achieved year-on-year growth in the first quarter of 2022.
Functional materials continue to make efforts, and OLED business will go to the next city
The functional materials of the company mainly include zeolite, LCD materials and OLED materials. In 2018, the company launched the “zeolite series environmental protection material construction project” with a planned capacity of about 7000 tons / year. By the end of 2021, with the total capacity of 4000 tons / year of the company’s two workshops put into use, the company’s existing zeolite capacity is nearly 10000 tons / year. The sixth national standard has been officially implemented since July 1, 2021. In the future, with the continuous promotion of the sixth national standard, the company’s zeolite sales are expected to reach a new level. As a supplier of finished OLED materials, monomer materials before sublimation and intermediate materials, the company occupies an important position in this field all over the world. At present, the finished OLED materials with independent intellectual property rights have been verified by downstream manufacturers. In the future, the company will continue to strengthen R & D and industrialization investment in the field of OLED materials. We estimate that in 2021, the company’s holding subsidiary Jiumu chemical (holding 45.33% of the shares, forming the actual control) made a profit of about 121 million yuan from the OLED pre sublimation materials business, and the profit reached a new high. At present, Jiumu chemical started the “OLED display materials and other functional materials project” in Yantai Chemical Park during the reporting period. In the future, with the expansion of the application scale of OLED materials in the field of small and medium-sized displays, The company is expected to further expand its market share in the field of OLED materials.
The great health industry has developed rapidly, and the certification of the new car workshop has been completed to ensure the growth of performance
By the end of 2021, the total production capacity of the company’s big health products was 210 tons / year, the utilization rate of production capacity exceeded 100%, and the sales volume increased significantly by more than 80%. In 2021, covid-19 antigen rapid detection kit products of MP company, an overseas subsidiary of the company, were registered and sold in Europe, Australia and other regions and countries; Norfloxacin Capsules of Wanrun pharmaceutical, a wholly-owned subsidiary of the company, entered the fourth batch of national drug centralized procurement catalogue; Viagliptin tablets obtained the registration approval according to the new requirements; Olmesartan axetil tablets obtained the production approval. Meanwhile, in 2021, the company established a pharmaceutical research institute, and the newly-built Pharmaceutical Workshop (B02 workshop) in phase I of Wanrun Industrial Park completed GMP certification within the reporting period. It will be put into use in the future, which will effectively alleviate the problem of insufficient production capacity of the company’s pharmaceutical products.
Investment advice
Due to the fluctuation of raw material prices, changes in the external environment and the adjustment of the company’s product structure, the company’s profit margin has been slightly adjusted. We raised the previous profit forecast. It is estimated that the operating revenue from 2022 to 2024 will be 5.463/63.21/7.420 billion yuan respectively (previously predicted that the operating revenue from 2022 to 2023 will be 4.801/5.191 billion yuan respectively), a year-on-year increase of + 25.3% / 15.7% / 17.4%, The net profit attributable to the parent company was 892 / 1071 / 1261 million yuan respectively (previously predicted that the net profit attributable to the parent company from 2022 to 2023 was 867 / 1025 million yuan respectively), with a year-on-year increase of 42.4% / 20.1% / 17.7% and EPS of 0.96/1.15/1.36 yuan respectively. Corresponding to the closing price of 17.85 yuan on April 29, 2022, PE is 19 / 16 / 13 times respectively. The company’s new construction projects will be implemented one after another in the future. We are optimistic about the company’s growth and maintain the “buy” rating.
Risk tips
The price fluctuation of raw materials and the unexpected risk of new expansion projects.
