\u3000\u3000 Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) (002271)
Event overview: Recently, the company released the performance express for 2021. ① in terms of revenue, it is expected to achieve a total operating revenue of 31.892 billion yuan, a year-on-year increase of + 46.8%; ② In terms of profit, the net profit attributable to the parent company is expected to be 4.185 billion yuan, a year-on-year increase of + 23.5%; The net profit attributable to the parent company after deduction was RMB 3.885 billion, a year-on-year increase of + 25.7%. According to this calculation, the net profit attributable to the parent company in 21q4 was 1.507 billion yuan, a year-on-year increase of + 19.8%; The net profit attributable to the parent company after deduction was RMB 1.417 billion, a year-on-year increase of + 33.9%.
High growth in adverse circumstances, and the annual performance is expected to meet the standard
In March 2021, the company issued an equity incentive plan, in which the unlocking condition in 2022 is that the net profit attributable to the parent company after deducting non return in 2021 will increase by 25% year-on-year. According to the performance express, the net profit attributable to the parent company after deducting non return in 2021 will increase by 25.7% year-on-year. We expect the company to successfully complete the incentive target. On the other hand, the company passed the financial budget report for 2021 in March 2021, proposing that the revenue budget index is 30 billion yuan and the net profit is 4.25 billion yuan. According to the express report, the revenue has exceeded the budget (the net profit is not disclosed). In 2021, there were great business challenges, land acquisition / new construction of real estate declined, credit risk of real estate enterprises and raw material prices rose sharply. The company still firmly completed the performance assessment objectives and demonstrated its leading advantages. From January to November 2021, the new construction area of real estate decreased by 9.1% year-on-year, of which the decline accelerated in the second half of the year. Top real estate developers represented by Evergrande and R & F frequently have credit default risks, expanding the receivable risk exposure of upstream material enterprises, putting great pressure on the overall industrial chain. In addition, the annual average of asphalt, acrylic acid and VAE increased by 19.8%, 55.7% and 84.4% respectively compared with the average in 2020. Asphalt and other raw materials account for 80-90% of the main business costs of the waterproof industry. It is expected that the annual gross profit margin is still under pressure.
Materials and construction scale increased with the same growth, and non housing and non prevention contributed significantly
The integrated company system established at the end of 2020 has achieved remarkable results, superimposing the national layout of production capacity. The company will fully sink the excavator channel in 2021, accelerate the expansion of non real estate market and effectively resist the pressure of real estate. In recent years, the non waterproof business that has been highly concerned has continued to grow rapidly. Represented by architectural coatings, a hundred related materials such as thermal insulation mortar, powder, diatom mud, ceramic tile adhesive and joint agent are in full bloom, and the extension of waterproof, construction and repair services has been accelerated. The progress of platform business structure has exceeded expectations. In addition, brand spillover, retail channels benefit, and the business of civil construction group develops well at the same time.
The concentration of the industry in the downward period is expected to accelerate, and the effect of raising the standard is expected
Using the waterproof revenue in the middle of 2021 / the revenue of Enterprises above the industry standard, the market rate of the company is 25%, and the industry concentration still has great room to improve. According to the general specification for building and municipal engineering (Exposure Draft) proposed by the Ministry of housing and urban rural development in 2019, there are detailed provisions on the service life and brushing layers of waterproof materials. If the new regulations are approved and implemented, we expect to kill three birds with one stone: promote the capacity, quality and concentration of the industry, and the promotion effect is expected.
Investment suggestions:
We estimate that the net profit attributable to the parent company from 2021 to 2022 will be 4.17 billion yuan and 5.27 billion yuan respectively, and the PE corresponding to the share price on January 14, 2022 will be 29x and 23x respectively. Maintain a “recommended” rating.
Risk tips:
The price change of raw materials is less than expected; The risk of continued tightening of real estate policy; Municipal and infrastructure investment was lower than expected.
