\u3000\u3 China Vanke Co.Ltd(000002) 497 Sichuan Yahua Industrial Group Co.Ltd(002497) )
Investment logic
Civil explosion + lithium salt double main business in parallel. The company started with the civil explosive business and entered the lithium salt industry through M & A in 13 years. In the 21st year, the gross profit of lithium salt business was 1.044 billion yuan, surpassing the civil explosion business for the first time; 22q1 net profit attributable to the parent company was 1.022 billion yuan, with a year-on-year increase of 1210%. The performance elasticity of lithium salt business began to appear, and the profit of civil explosion business was stable.
Lithium salt business: the ability of resource guarantee is improved, and the capacity of lithium hydroxide continues to expand
Industry: the tight balance between supply and demand in 22 years is determined. It is predicted that China will supply 533000 tons, demand 559000 tons and gap 26000 tons. It is expected that in the first half of the year, due to the impact of the epidemic, the trend of lithium price fluctuated weakly, the demand rebounded in the second half of the year, and the high level of lithium price remained, with an annual average price of 45 Tianma Microelectronics Co.Ltd(000050) 0000 yuan / ton.
Resources: at present, the company has the priority supply right of Lijiagou spodumene mine; Signed a long-term lithium concentrate supply agreement with Galaxy resources in Australia; Take shares in Australian core company and aby company and sign the lithium concentrate underwriting agreement; Participate in EFE Australia, EVR Australia and hold 60% of the subsidiaries of super lithium Canada. In 23-24 years, the company’s total underwriting concentrate annual production capacity will reach about 500000 tons.
Capacity: at present, the company has an annual capacity of 43000 tons of lithium salt, including 33000 tons of lithium hydroxide and 6000 tons of lithium carbonate. 30000 tons of lithium hydroxide in Ya’an phase II is expected to be put into operation by the end of 22, and 20000 tons of lithium hydroxide and 11000 tons of lithium chloride are planned in phase III. It is estimated that the annual lithium salt production capacity of the company will reach 104000 tons in 25 years, and the proportion of agreed mine guarantee and supply in 23-24 years will exceed 100%, with sufficient resources. The downstream signed a supply agreement with Tesla, and the company’s planned total lithium hydroxide capacity ranked fifth in the world in 25 years.
Civil explosive business: the regional advantages of Western Sichuan benefit from the construction of Sichuan Tibet line and the improvement of the penetration rate of electronic detonators. The civil blasting industry has obvious cyclical and regional characteristics. The company has 20 civil blasting production sites and more than 20 blasting companies. The commencement of Sichuan Tibet railway will bring performance increment. According to the policy guidelines, the production of industrial detonators other than electronic detonators was stopped at the end of June and the sales of industrial detonators other than electronic detonators were stopped at the end of August. At present, the penetration rate of electronic detonators is only 18%. According to the prediction of Huajing Industrial Research Institute, its comprehensive replacement market space is about 15 billion. The company’s production capacity of electronic detonators is 54 million, with the annual sales volume of 21 ranking first in China, accounting for 20% of the market. It will continue to expand its production capacity in the future.
Profit forecast & investment suggestions
It is estimated that the net profit attributable to the parent company in 22-24 years will be 3.944 billion yuan, 4.55 billion yuan and 4.706 billion yuan respectively; The corresponding EPS is 3.42 yuan, 3.95 yuan and 4.08 yuan respectively; The corresponding PE is 7.5 times, 6.5 times and 6.3 times respectively. The valuation adopts PE method, giving the company 10 times PE in 22 years, with a corresponding market value of 39.4 billion yuan and a target price of 39.48 yuan / share. It is given a “buy” rating for the first time.
Risk tips
Downstream demand is lower than expected; Actual controllers, persons acting in concert, supervisors, stock reduction risk, etc.
