\u3000\u3000 Ningxia Baofeng Energy Group Co.Ltd(600989) (600989)
Event: the company issued the announcement of performance increase in 2021. In the 21st year, the company is expected to realize the net profit attributable to the parent company of 6.8-7.2 billion yuan, a year-on-year increase of 47.1% - 55.8%, and it is expected to deduct the non attributable profit of 7.1-7.5 billion yuan, a year-on-year increase of 46.0% - 54.2%; Among them, Q4 is expected to realize a net profit attributable to the parent company of RMB 1.48-1.88 billion in a single quarter, with a year-on-year increase of 0.7% - 27.9% and a month on month change of - 6.5% - 18.7%.
Comments:
The price of main products rose sharply, with high performance growth in 21 years: the price of crude oil rose in 2021, driving the price of chemical products. The company's main product prices rose sharply year-on-year, its profitability improved significantly, and its performance achieved high growth in 21 years. In 2021, the average prices of polyethylene, polypropylene, coke and pure benzene were 8781 yuan / ton, 8914 yuan / ton, 2830 yuan / ton and 7071 yuan / ton respectively, with a year-on-year increase of 20%, 9%, 57% and 81%. Looking forward to 2022, the company will add a coking project with an annual output of 3 million tons and a coke oven gas to methanol project with an annual output of 400000 tons, which is expected to further thicken the company's performance.
The advantages of industrial chain integration are obvious, which can effectively alleviate the price impact of raw materials: affected by the "double control" policy, the coal price has risen sharply in 21 years, and the cost of raw materials has increased. In 2021, the company's industrial chain will be continuously improved, with obvious advantages of industrial chain integration. At present, the company has formed a circular economy industrial chain of "coal, coke, gas, methane, olefins, polyethylene, polypropylene and fine chemicals", formed three main industrial chains of coal mining, coal to methanol and methanol to olefins, realized the self production of coal, methane and other raw materials, and greatly improved the company's ability to resist cycle and risk. The company promotes management optimization and technological innovation in olefin production and coal mining, reduces unit consumption of products, improves resource utilization efficiency, and effectively alleviates the impact of sharp rise in raw material prices.
The "green hydrogen" project leads the industry, and the company's competitiveness is prominent: the national Cecep Solar Energy Co.Ltd(000591) electrolytic hydrogen storage and application demonstration project currently under construction by the company can produce 240 million standard cubic meters of "green hydrogen" and 120 million standard cubic meters of "green oxygen" per year to replace coal for hydrogen and oxygen production. The project can save about 380000 tons of coal and carbon resources and reduce carbon dioxide emissions by about 660000 tons per year. The company's "green hydrogen" project leads the industry, actively implements carbon emission reduction measures, and helps the country achieve the "double carbon" goal. Subsequently, the company will improve the conversion rate through scientific and technological innovation, continuously reduce production costs and effectively control the cost of green hydrogen, which will further highlight the competitiveness of the company.
Profit forecast, valuation and rating: we maintain the company's profit forecast. It is estimated that the net profit from 2021 to 2023 will be RMB 7.06/84.00/12.671 billion respectively, equivalent to EPS of RMB 0.96/1.15/1.73 respectively, maintaining the "overweight" rating.
Risk warning: risk of sharp fluctuation of product price; Risk of sharp rise in raw material prices; The production progress of the project is less than expected
