\u3000\u3 China Vanke Co.Ltd(000002) 078 Shandong Sun Paper Co.Ltd(002078) )
Event:
The company released the first quarterly report of 2022: the revenue in the first quarter of 2022 was 9.667 billion yuan, a year-on-year increase of 26.48%; The net profit attributable to the parent company was 675 million yuan, a year-on-year decrease of 39.08%; Deduct the net profit not attributable to the parent company of 658 million yuan, a year-on-year decrease of 39.22%; Achieve earnings per share of 0.25 yuan.
Guoyuan view:
Actively invested in research and development, and the profitability improved month on month
In 2022, the price of bulk materials in Q1 was much higher than that in the same period last year, and the profit margin of the company was under pressure. The gross profit margin / net profit margin were 13.97% / 6.99% respectively, which was -9.47 / -7.55pcts year-on-year compared with 21q1 and + 4.07 / + 4.70pcts month on month compared with 21q4. On the expense side, the company’s Q1 sales expense rate / management expense rate / financial expense rate in 2022 were 0.40% / 2.52% / 1.33% respectively, with a year-on-year increase of + 0.01 / + 0.41 / – 0.75pcts respectively in 21q1. The significant increase in management expenses was mainly due to the amortization cost of equity incentive costs and the increase in sewage treatment fees brought by the commissioning of new projects in Guangxi base. The company’s R & D rate in 22q1 was 1.91%, an increase of 1.00pcts year-on-year in 21q1, and its R & D efforts continued to increase.
The Beihai project has been implemented, and Nanning Forest Pulp paper integration has begun
In 2021, the pulp project in the “Forest Pulp paper integration” project in Beihai Park of the company’s Guangxi base has been successfully put into trial production. It is expected to achieve full production and efficiency in 2022, which can effectively reduce the company’s cost while ensuring product quality. Based on the implementation of Beihai Park project, Nanning Shandong Sun Paper Co.Ltd(002078) Co., Ltd. was newly established on February 9, 2022. On February 26, the company signed the strategic cooperation framework agreement with Nanning Municipal People’s government, which agreed to invest in the construction of “5.25 million tons per year Forest Pulp paper integration and supporting industrial park project” in Nanning, Guangxi. The project has the comprehensive advantages of geographical location, diversified raw materials and preferential policies. It is expected to cooperate with Shandong base Laos base and Guangxi Base Beihai “Forest Pulp paper integration” project are integrated and coordinated to improve the company’s sustainable development ability.
Existing capacity upgrading + emerging capacity expansion support long-term performance growth
In 2022, the company will actively promote the construction of new production capacity and the upgrading of existing production capacity. In terms of upgrading the existing production capacity, Q1 company relocated the 50000 ton special paper production capacity equipment of the resident branch of Xinglongzhuang town to Yandian Town Industrial Park to actively optimize the production capacity layout. In terms of the implementation of new production capacity, the first phase of the 150000t / a household paper project of the wholly-owned subsidiary Guangxi Shandong Sun Paper Co.Ltd(002078) Co., Ltd. (the designed capacity of household paper base paper is 100000 tons) is expected to be completed and put into operation in the second half of this year, which will help the company further improve its market share in the differentiated market segments; Shandong taiyanghonghe Paper Co., Ltd. has an annual output of 34000 tons of ultra-high strength special paper in Taiping Town, Zoucheng City. The project is also expected to be put into operation in Q1 2023. In the short term, we believe that with the subsequent marginal improvement of energy costs and the optimization of industry supply and demand structure, the ton profit is expected to pick up accordingly. In the medium and long term, as the company’s projects are put into operation and the production capacity is gradually released, the cost scale advantage of the company will gradually become prominent.
Investment advice and profit forecast
The company is a leader in the integration of forestry, pulp and paper. The pace of capacity expansion is clear, the cost advantage of scale effect is prominent, and the medium and long-term market share is expected to increase steadily. It is estimated that the company will achieve revenue of 34.418/36.322/38.246 billion yuan, net profit attributable to parent company of 3.089/33.08/3.637 billion yuan, EPS of 1.15/1.23/1.35 yuan and corresponding PE of 10.33/9.64/8.77 times from 2022 to 2024 respectively, maintaining the “buy” rating.
Risk tips
The price of raw materials fluctuates greatly; Less than expected demand growth; The production capacity was lower than expected.
