\u3000\u3000 Jiangsu Rainbow Heavy Industries Co.Ltd(002483) (002483)
Event: the company released the performance forecast for 2021. It is estimated that the net profit attributable to the parent company will be 340-380 million yuan in 2021, with a year-on-year increase of 32.8% – 48.4%; The non net profit attributable to parent deduction was RMB 290-330 million, with a year-on-year increase of 38.2% – 57.2%. The company’s high-end equipment and environmental protection business are positive, and the performance is growing rapidly, which is in line with our expectations.
The development of offshore wind power industry has entered the fast lane, and the company’s offshore wind power equipment business will fully benefit. Offshore wind power has the unique advantages of being close to the power load center and good consumption conditions. Under the trend of large-scale wind turbines and large-scale wind farms, the cost of kwh power is falling rapidly and will usher in the era of parity. It is estimated that the newly installed capacity of offshore wind power in China will exceed 50gw during the 14th Five Year Plan period. Based on the calculation that 1.5-2 billion foundation piles are required for the installation of a single GW of offshore wind power, the average annual market scale of foundation piles in China during the 14th five year plan period is nearly 20 billion. Runbang ocean, a wholly-owned subsidiary of the company, is a leading enterprise in the offshore wind power equipment business. At present, it has an annual capacity of 200000 tons of foundation piles, which will fully benefit from the vigorous development of offshore wind power.
Orders for material handling equipment soared, with strong certainty of performance growth; The ship supporting and environmental protection business is actively improving. By Q3 of 2021, the company’s orders for material handling equipment were about 3.8 billion yuan. At the beginning of 2022, the company announced that Koch, the holding Sun company of Germany, would sign a contract with the National Meteorological Administration of the United Arab Emirates to provide it with seven sets of bulk material handling equipment systems and on-site installation and commissioning services, with a total contract price of 910 million euros, equivalent to about 6.56 billion yuan, It is estimated that up to now, the orders in hand are about 10 billion. In 2021, China’s new shipbuilding orders surged, and the orders and revenue of the company’s hatch covers and other ship supporting equipment business are expected to increase significantly. The gross profit margin of hazardous waste, medical waste and sludge treatment business is high, which contributes stable profits and cash flow to the company.
Guangzhou industrial control is about to take over, and the South high-end equipment base will inject growth power into the company. Guangzhou industrial control is a state-owned holding enterprise in Guangzhou. After joining the company, it will vigorously support the company to build a high-end equipment industry base in the South and expand the market orders for offshore wind power equipment, port terminal equipment and environmental protection business in the Great Bay area of Guangdong, Hong Kong and Macao. The empowerment of Guangzhou industrial control will make the company’s development speed and development potential more imaginative.
Profit forecast and investment suggestions. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 376 million, RMB 497 million and RMB 669 million respectively, and the compound growth rate of the net profit attributable to the parent company in the next three years will be 37.7%. The company will be given 20 times PE in 2022 and the target price will be RMB 10.60, maintaining the “buy” rating.
Risk warning: macroeconomic deterioration risk; Risk of deterioration of industry competition pattern; Goodwill impairment risk. thirty-nine thousand four hundred and fifty-seven
