\u3000\u3000 Trina Solar Co.Ltd(688599) (688599)
Event: the company issued the announcement of performance increase in 2021. It is estimated that the net profit attributable to the parent company will reach 1.72 ~ 2.05 billion yuan in 2021, with a year-on-year increase of 39.92% ~ 66.76%, and the net profit deducted from the non parent company is expected to reach 1.473 ~ 1.803 billion yuan, with a year-on-year increase of 32.45 ~ 62.12%, which is in line with the market expectation. According to the performance forecast, the company is expected to realize a net profit attributable to the parent company of 564 ~ 894 million yuan in 2021q4, with a year-on-year increase of 42 ~ 125% and a month on month increase of 25% ~ 98%.
In 2021, the component shipping industry will be the second, and the layout of large-size products will be further improved. According to PV tech statistics, the company's component shipments increased from the fourth in the industry in 2020 to the second in the industry in 2021, and the company has leading technology and product advantages in 210 large-size battery modules. We expect the company's 210 component shipments to be the first in the industry in 2021, driving the rapid growth of the company's performance in 2021. Looking forward to 2022, with the release of upstream silicon material and silicon wafer production capacity, its price is expected to enter the downward channel. We maintain the judgment that the global PV installed capacity will exceed 220gw in 2022. The company's module shipment is expected to continue to improve and its profitability will be repaired.
By the end of 2021, the total component capacity of the company is expected to be 50gw, of which 210 capacity is about 44gw, accounting for more than 80%; The capacity of battery is expected to be 35gw, of which 210 capacity accounts for more than 70%; The project construction of superposition company and Tongwei cooperation has been steadily promoted. The leading layout of 210 products and the improvement of the whole industrial chain are expected to further improve the company's profitability and market share.
Overweight distributed market layout and steady progress in global smart energy layout. The company took the lead in the industry and unswervingly laid out the distributed market. The shipment of the original household system of "Trina Solar Fuga" increased by more than 300% year-on-year in 2021h1. At the same time, it also released the BIPV product "tiannengwa" to further improve the product layout in the field of distributed photovoltaic. The sales of distributed business increased significantly in 2021, making a strong contribution to the growth of the company's performance in 2021.
In addition, the company continued to make efforts in the energy storage intelligent solution business, and became the first Chinese household energy storage company certified by jet and shipped in batches in Japan; In June 2021, the company and China Petroleum & Chemical Corporation(600028) signed a strategic cooperation framework agreement. In the future, the company will carry out in-depth cooperation in zero carbon energy transformation of gas stations, green electricity hydrogen production, photovoltaic material supply and R & D.
Maintain the "buy" rating: the company's sales of large-scale products and distributed businesses have significantly improved, and the profit advantages of large-scale and differentiated products are expected to be further highlighted in the future. We raised the company's net profit forecast for 22-23 years. It is expected that the company's net profit attributable to the parent company in 2021-23 will be RMB 1.989/3.79/4.571 billion respectively (maintain / increase 15% / increase 12%), corresponding to EPS of RMB 0.96/1.73/2.20, The current share price corresponding to PE is 70 / 39 / 31 times respectively. The company's PV module shipments rank among the top in the world. The advance layout of large-scale products will ensure that the company can obtain excess returns under the background of price reduction in the industrial chain. The distributed and energy storage business is expected to become a new performance growth point and maintain the "buy" rating.
Risk tip: the global PV installation, the company's capacity expansion and product sales were less than expected, and the price war in the PV industry chain was more intense than expected.
