\u3000\u3 Guocheng Mining Co.Ltd(000688) 006 Zhejiang Hangke Technology Incorporated Company(688006) )
Event 1:
The company released its annual report for 2021. The annual operating revenue increased by 66.35%, and the net profit attributable to the parent company increased by – 36.79%: 1) in 2021, the company achieved a revenue of 2.483 billion yuan, a year-on-year increase of + 66.35%, and Q4 achieved a revenue of 722 million yuan, a year-on-year increase of + 56.06%; 2) In the whole year, the net profit attributable to the parent company was 235 million yuan, a year-on-year increase of – 36.79%, and the net profit attributable to the parent company in Q4 was – 03 million yuan, a year-on-year increase of – 104.58%; 3) In the whole year, the non net profit deducted was 166 million yuan, a year-on-year increase of – 47.94%, and the non net profit deducted in Q4 was – 36 million yuan, a year-on-year increase of – 154.12%; 4) The net operating cash flow of the company in the whole year was 482 million yuan, a year-on-year increase of + 64.77%.
From the perspective of splitting the company’s business, each product echelon has developed steadily:
In the whole year, the three major product lines of charging and discharging equipment, other equipment and accessories achieved sales revenue of RMB 1.816609/0.30 billion respectively, with a year-on-year increase of 64.31% / 78.37% / 31.34% and gross profit margin of 26.60% / 21.71% / 53.56% respectively. Compared with the year-on-year increase of -21.81pct / – 19.40pct / – 17.38pct, the main business performance of the company increased steadily and contributed to the high-quality development of the company.
Due to the fierce market competition, the rise in the price of raw materials and the slowdown in the expansion of overseas customers, the profitability has declined significantly:
The annual gross profit margin of the company was 26.25%, year-on-year -22.19pct, and the gross profit margin of Q4 was 16.83%, year-on-year -30.09pct; The annual net interest rate was 9.47%, year-on-year -15.44pct, Q4 net interest rate was -0.41%, year-on-year -14.3pct; However, the company’s expense control ability in the 21st year was good. The expense rate of the company in the 21st year was 17.04%, with a year-on-year decrease of 3.19pct, and the expense rate of Q4 was 19.11%, with a year-on-year decrease of 4.54pct. Among them, the expense rates of sales / management / R & D / Finance in the 21st year were 1.94% / 8.11% / 5.29% / 1.71%, with a year-on-year change of -2.51pct / – 1.42pct / – 1.65pct / + 2.39pct respectively.
Event 2:
The company released the first quarter report of 2022. The performance of the first quarter was brilliant. In 2022q1, the company achieved a revenue of 797 million yuan, a year-on-year increase of + 155.40%; The net profit attributable to the parent company was 94 million yuan, a year-on-year increase of + 80.17%; The net profit deducted from non parent company was 86 million yuan, a year-on-year increase of + 86.73%; The gross profit margin was 30.30%, with a year-on-year increase of -9.45pct; The net interest rate was 11.76%, year-on-year -4.91pct; The company’s expense control ability in the first quarter was good. The expense rate in 2022q1 was 18.83%, a year-on-year decrease of 9.21pct, of which the expense rates of sales / management / R & D / finance were 3.03% / 10.24% / 4.62% / 0.94% respectively, with a year-on-year change of -1.67pct / – 2.13pct / – 3.48pct / – 1.93pct respectively.
Actively explore markets outside China and practice the strategy of “walking on two legs”:
In 2021, the impact of covid-19 epidemic continued, and the expansion of overseas customers was still less than expected. According to the economic situation and market conditions, the company paid equal attention to China and overseas markets; In 2021, the company successfully won the bid for SK American factory project in South Korea, realizing the breakthrough of large-scale export of equipment to the United States, providing experience accumulation and setting a benchmark for the later development of the American market, which is of milestone significance to the company’s development in the American market; While continuing to maintain overseas customers, it also actively develops and maintains Chinese head customers, and further cooperates with Eve Energy Co.Ltd(300014) , Byd Company Limited(002594) , Gotion High-Tech Co.Ltd(002074) and other excellent battery enterprises.
Continuously strengthen R & D investment and actively promote new product R & D:
The company always takes technological innovation as the driving force for development and continuously strengthens R & D investment; The company has set up a technology center to engage in the research and development of basic technology and the construction of underlying architecture, and set up a product center to conduct targeted research and development of products according to specific customer needs; In 2021, the company’s R & D personnel increased by 294, reaching 881, accounting for 25.73% of the total number of the company; The R & D cost was 1312721 million yuan, an increase of 26.75% over the previous year; The company has always been oriented to meet the needs of customers, closely follow the front-line customers and timely meet the needs of customers for product and technology upgrading. The R & D achievements obtained in 2021 are mainly reflected in the upgrading of chemical capacity separation equipment and the successful development of a new generation of 4680 large cylindrical battery and square battery charging and discharging equipment.
Profit forecast: taking into account the market competition and the slowdown in the expansion of overseas customers, we predict that the net profit attributable to the parent company from 2022 to 2024 will be 642 million (the former value is 697 million), 835 million (the former value is 1105 million) and 1096 million respectively, and the corresponding PE will be 27.58/21.20/16.14x respectively, maintaining the buy rating.
Risk tips: the risk of technology and product substitution, the risk of high customer concentration, the risk of adverse customer development of power lithium battery manufacturers, etc.
