\u3000\u3000 Wanhua Chemical Group Co.Ltd(600309) (600309)
The company expects to realize a net profit attributable to the parent company of 24 billion yuan to 25.2 billion yuan in 2021, maintaining the “buy” rating
On January 17, 2022, the company issued an announcement on the advance increase of annual performance in 2021. It is estimated that the net profit attributable to the parent company will reach 24 billion yuan to 25.2 billion yuan in 2021, with a year-on-year increase of 139% to 151%. We are optimistic that the MDI industry will be stable and good, and the petrochemical and new materials sectors will continue to increase the company’s profit space. Combined with the company’s announcement, we will reduce 2021 and maintain the profit forecast for 2022-2023. It is estimated that the company’s net profit attributable to the parent company in 2021-2023 will be 249.61 (- 7.43), 26.437 and 29.095 billion yuan respectively, corresponding to EPS of 7.95 (- 0.24), 8.42 and 9.27 yuan / share respectively, The current share price corresponding to PE is 12.0, 11.3 and 10.3 times respectively. Maintain the “buy” rating.
In September 2021, the “dual control of energy consumption” increased the cost pressure of raw materials and energy again, and Q4 fell month on month
Q4 expects the company to realize a net profit attributable to the parent company of RMB 4.46-5.66 billion, down 6% – 26% month on month compared with Q3, which is basically in line with expectations. According to wind data, the average price of Q4 pure MDI is 22227 yuan / ton, a month on month ratio of – 1.1%, and the average price of aggregate MDI is 20334 yuan / ton, a month on month ratio of + 2.3%; The average price difference of pure MDI was 17545 yuan / ton, a month on month increase of + 1.1%, the average price difference of aggregate MDI was 15652 yuan / ton, a month on month increase of + 6.1%, and the average price difference of comprehensive MDI was 16220 yuan / ton, a month on month increase of + 4.4%. MDI prices and price spreads have expanded slightly, but the prices of petrochemical products such as cyclopropyl alcohol, n-butanol and butyl acrylate have declined compared with Q3. In addition, the “dual control of energy consumption” was launched in September 2021, and the impact on the cost side and downstream demand side was also reflected from Q4. On the cost side, the prices of the company’s main raw materials such as coal and propane still increased significantly. According to Baichuan Yingfu, the average price of Q4 power coal was 1181 yuan / ton, up 29% month on month, and the average price of propane in Shandong was 6007 yuan / ton, up 20% month on month. The rise of raw materials and costs has brought certain pressure on the company’s profitability, or it is the main reason for the month on month decline of Q4 company’s performance.
The strategic layout of “double carbon” has become increasingly clear. With the promotion of base construction in Fujian and Sichuan, the growth is still expected
In the first half of 2021, the company participated in Huaneng (Haiyang) and Huaneng (Laizhou) to layout the Yuguang complementary photovoltaic power generation and wind power generation projects. In the future, green power will be introduced, which is expected to achieve the “double carbon” goal as soon as possible. On August 21, 2021, Fujian base held the commencement ceremony of large equipment installation of MDI integration project. At present, the project construction is progressing steadily. On January 14, 2022, the commencement ceremony of the company’s Meishan base lithium iron phosphate cathode material project with an annual output of 50000 tons was officially held, marking the formal commencement of the project and the company’s future growth is still expected.
Risk tip: the production capacity is lower than expected, the downstream demand slows down, and the product price drops sharply.
