\u3000\u3000 Guangdong Jiayuan Technology Co.Ltd(688388) (688388)
Event: the company released the performance forecast for 2021. It is estimated that the net profit attributable to the parent company will reach 530-603 million yuan in 2021, with a year-on-year increase of 184.25% to 223.56%; It is expected to realize a net profit of 479-546 million yuan, with a year-on-year increase of 192.59% to 233.05%. The performance is in line with expectations.
High performance growth, profitability and industry-leading. The net profit attributable to the parent company in 2021q4 was 136-209 million yuan, with a year-on-year increase of 94% to 199% and a month on month increase of – 9% to + 39%; Net profit deducted from non parent company was RMB 114 million to 181 million, with a year-on-year increase of 68% to 166% and a month on month increase of – 15% to + 34%. The performance growth was mainly due to the release of new production capacity, driving the rapid growth of production and sales, as well as the steady improvement of operation efficiency and profitability. It is estimated that the company’s shipment volume in 2021 will be 27000 tons, with the median net profit of about 21000 yuan / ton per ton belonging to the parent company, and its profitability will maintain the industry-leading level. Positive expansion of production and rapid growth of production and sales. The company seizes the opportunity of rapid development of new energy vehicles and lithium battery industry and actively expands production. In August 2021, the company wholly acquired Shandong Jiayuan new energy materials Co., Ltd. (formerly “Shandong xinliyuan”) with its own funds, and quickly achieved the goal of expanding production capacity through technological transformation and optimization. In December 2021, the first 5000 t / a production line of “15000 T / a high performance copper foil project” in Baidu Town, Meixian District of the company was successfully put into trial production, and Q1 will contribute to the increment in 22 years. Based on the calculation of the company’s capacity under construction and release progress, it is expected that the company’s capacity will reach 60000 tons in 2022 and 100000 tons in 2023, and the capacity scale will maintain rapid growth. The tight balance between supply and demand continues, the product structure is improved and high profitability is maintained: the demand for lithium copper foil is strong in 2021. Due to equipment constraints and long production expansion cycle, the supply of lithium copper foil is in short supply, resulting in an increase in processing fees. In 2022, the tight balance between supply and demand of copper foil is expected to continue, and the processing fee is expected to remain high. In addition, at present, the demand for 4.5 micron copper foil at the user end is increasing, and the company is one of the few manufacturers with 4.5 micron batch supply capacity, with leading product quality and technical level. With the increase of the application proportion of 4.5 microns and the introduction of high value-added new products such as high tensile strength, the profitability of the company is expected to be further improved by virtue of the improvement of product structure and excellent cost control ability. PCB high-end copper foil opens up growth space and grows together with high-quality customers. In November 2021, the company announced that it planned to raise an additional 4.9 billion yuan for Guangdong Jiayuan Technology Co.Ltd(688388) Park, Ningde, Shandong lithium battery copper foil project and Jiangxi electronic circuit copper foil project. The lithium battery copper foil expansion project mainly serves the needs of Contemporary Amperex Technology Co.Limited(300750) , Byd Company Limited(002594) , Funeng and other high-quality customers, and adds PCB high-end copper foil to further open up growth space. In December 2021, the company announced that it had signed a memorandum of intent on joint venture investment with Contemporary Amperex Technology Co.Limited(300750) to jointly build a high-performance copper foil project with an annual output of 100000 tons, which will be constructed in two phases, bind high-quality customers, and lay a foundation for long-term growth.
Maintain the “buy” rating: due to the large scale of the company’s new production expansion projects in the second half of 21 years, in-depth cooperation with leading battery manufacturers, full orders and high capacity utilization, it is expected that the centralized release of capacity will contribute to the performance increment in 22-23 years, and the net profit forecast will be raised to RMB 565 / 1180 / 1981 million (5% / 45% / 89%), corresponding to PE 53 / 25 / 15 times. As the leader of China Shipbuilding Industry Group Power Co.Ltd(600482) lithium battery copper foil, the company leads in technology and market share. Benefiting from the strong demand for new energy vehicles, PCB high-end copper foil opens up growth space and maintains the “buy” rating.
Risk tips: capacity digestion risk, intensified competition, technology iteration, loss of core technicians and other risks.
