\u3000\u3 China Vanke Co.Ltd(000002) 050 Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) )
Key investment points
2022q1 revenue + 41%, net profit attributable to parent company + 26%, performance in line with market expectations. In 2022q1, the company achieved an operating revenue of 4.804 billion yuan, an increase of 40.94% year-on-year and 11.69% month on month; The net profit attributable to the parent company was 453 million yuan, a year-on-year increase of 25.81%, and the performance was in line with market expectations. We expect that in 2022q1, the shipment of steam and spare parts will continue to grow month on month, and the traditional refrigeration will also maintain a good growth due to structural factors such as order return and commercial refrigeration.
Affected by the rising price of raw materials & shipping, the company’s gross profit margin is still under pressure, but it has improved month on month. In 2022q1, the gross profit margin was 23.30%, with a year-on-year ratio of -3.94pct and a month on month ratio of + 1.67pct; In 2022q1, the net interest rate attributable to the parent company was 9.43%, a year-on-year decrease of 1.13pct and a month on month increase of 0.34pct. 2022q1 sales, management (including R & D), R & D and financial expense rates are 2.17% / 9.39% / 4.79% / 0.52% respectively. The price of bulk raw materials & freight remains high, so the gross profit margin has declined. However, the company actively promotes price linkage with the downstream. Looking forward to the whole year of 2022, the gross profit margin is expected to stabilize and recover.
The refrigeration sector grew steadily: domestic refrigeration orders continued to return, and the structural performance of commercial refrigeration and other fields was good. In terms of household refrigeration, despite the slight increase in industry demand, the output of household air conditioners in 2022q1 was 41.46 million, a year-on-year increase of + 2.5%. However, the acquisition of competitors in the early stage led to the transfer of some orders to the company, and the order transfer process is expected to continue; Commercial refrigeration will continue to grow at a high speed, with large replacement space; Microchannels are mainly for overseas customers. The rise in the price of raw materials & shipping freight in the early stage has dragged down the profit level of the sector and is expected to improve; Yaweko has achieved breakeven and is expected to continue its growth trend.
In 2022q1, the production and sales of new energy vehicles are booming, and the demand for vehicle thermal management remains high. According to the data of China Automobile Association, the sales volume of new energy vehicles in 2022q1 was 1257000, a year-on-year increase of + 138.4%. In terms of major customers in North America, the total sales volume of 2022q1model3 and modely was 295000, a year-on-year increase of + 61.51%. We expect that the impact of the shutdown of key customers in North America in Shanghai on the company is relatively controllable, and the production of key customers has begun to recover gradually. Looking forward to 2022, the company’s new energy vehicle business has abundant orders and strong production scheduling, and the number of major customers in North America and other brands such as velai / Volvo will continue to increase; Fuel vehicles are basically stable. We expect that the annual zero income of automobile is expected to reach more than 60%, with a year-on-year increase.
Profit forecast and investment rating: we maintain the company’s net profit attributable to the parent company in 202224 to be 2.32 billion yuan, 3.03 billion yuan and 3.87 billion yuan respectively, with a year-on-year increase of + 38%, + 30% and + 28% respectively, corresponding to the current price PE of 26x, 20x and 16x respectively, and the target price of 22.75 yuan, corresponding to 35 times PE in 2022, maintaining the “buy” rating.
Risk tip: the sales of household appliances are less than expected, the sales of new energy vehicles are less than expected, and the competition is intensified.
