\u3000\u3000 Ningxia Baofeng Energy Group Co.Ltd(600989) (600989)
Event: on January 12, 2022, the company released the performance forecast for 2021. It is estimated that the net profit attributable to the parent company will be 6.8-7.2 billion in 2021, with a year-on-year increase of 2.18-2.58 billion yuan, a year-on-year increase of 47.10% - 55.75%; The net profit of non parent company deduction was RMB 7.07-7.47 billion, with a year-on-year increase of RMB 2.23-2.63 billion, with a year-on-year increase of 45.95% - 54.20%.
The industrial chain integration has significant advantages and the performance has increased significantly. According to the calculation, the company's net profit attributable to the parent company in 21q4 was RMB 1.48-1.88 billion, with a month on month change of - 7% - + 19% and a year-on-year increase of 1% - 28%, mainly benefiting from the decline of coal price in 21q4 and the pressure on raw material cost. Throughout the year, due to the continuous improvement of the integration of the company's coal to olefin and coke industrial chain, the self-produced coal production capacity has been gradually increased, effectively alleviating the impact of the sharp rise in raw material prices; In addition, while the company's product price increased year-on-year, the company continuously optimized the process structure, significantly improved the operation efficiency and significantly improved the performance.
Olefin sector: product prices remain high, new production capacity will be put into operation, and the performance of olefin sector is expected to continue to grow in 22 years. On the one hand, according to wind data, since the fourth quarter, the prices of polyethylene and polypropylene have dropped slightly from the highest point in the third quarter, but the decline is not obvious and remains at a high level in recent years. Combined with the decline in the price of raw material coal, the product price difference has widened again, and the single ton profit in 22 years will be strongly supported. On the other hand, the company's Ningdong phase III 1 million T / a olefin project is expected to be gradually put into operation in the second half of 2022. After being put into operation, the company's olefin production capacity will increase from 1.2 million T / A to 2.2 million T / A, which will drive the performance growth of the company's olefin sector from 2022 to 2023. In addition, the 250000 ton EVA plant is under construction as planned and will be completed and put into operation in 2023, and the 4 million ton olefin project in Inner Mongolia is steadily advancing.
Coke sector: new production capacity has been put into operation and performance release is imminent. The company has built a new capacity of 3 million tons / year by the end of 21 years, and the coke capacity of the company has increased from 4 million tons to 7 million tons. Although the coke price is significantly lower than the high point in the third quarter, it is still at a high level in recent five years. With the gradual release of new production capacity in 2022, it will provide a significant increment for the performance of the company's coke sector.
Under the goal of "double carbon", the company actively promotes the Cecep Solar Energy Co.Ltd(000591) electrolytic hydrogen production and energy storage project. The company's national Cecep Solar Energy Co.Ltd(000591) electrolytic hydrogen production energy storage and application demonstration project has been completed and put into operation at the end of 21, with an annual output of 240 million standard cubic meters of "green hydrogen" and 120 million standard cubic meters of "green oxygen", which can increase and reduce the consumption of coal resources by about 380000 tons, increase and reduce the carbon dioxide emission by about 660000 tons, and increase and reduce 5% of the total carbon emission of chemical plants.
Investment suggestion: considering the pressure brought by the rising price of coal and other raw materials, we reduce the net profit attributable to the parent company from 2021 to 2023 to 7.1/83/10.6 billion yuan, and the PE corresponding to the closing price on January 13, 2022 is 17 / 15 / 12 times; According to our prediction, the average annual compound growth rate of the company's net profit attributable to the parent company from 2020 to 2023 is 31.7%. Considering the uncertain growth of performance brought by the company's continuous production capacity in the future, we maintain the "recommended" rating.
Risk warning: the risk of slow production progress; Risk of falling prices of main products such as polyethylene, polypropylene and coke; Risk of rising raw material costs.
