\u3000\u3000 Guizhou Chanhen Chemical Corporation(002895) (002895)
Event: on the evening of January 20, the company released the performance forecast for 2021. In 2021, the company expects to realize a net profit attributable to the parent company of RMB 314 ~ 371 million, with a year-on-year increase of 120% ~ 160%; It is expected to realize a net profit of 296 ~ 342 million yuan after deduction, with a year-on-year increase of 160% ~ 200%. Among them, 2021q4 company is expected to realize a net profit attributable to the parent company of 102 ~ 159 million yuan, turning losses into profits compared with 2020q4, with a month on month ratio of – 5.0% ~ + 48.3%.
The price of main products rose, and the company’s performance increased significantly year-on-year. In 2021, the company’s products are still mainly fire grade monoammonium phosphate, calcium dihydrogen phosphate and phosphorus ore. thanks to the continuous rise in the price of phosphorus chemical products during the year, the company’s performance has been greatly improved. According to the data of Ifind and Boya Hexun, the average prices of monoammonium phosphate, calcium dihydrogen phosphate and phosphate rock increased by 28.0%, 21.1% and 40.1% respectively year-on-year in 2021. In 2021, the company’s phosphate rock production capacity will be increased to 3 million tons / year, and the production and sales of phosphate rock will be significantly improved, which will contribute to the high growth of the company’s performance. Looking forward to the future, in terms of traditional phosphorus chemical business, the company’s fixed increase and convertible bond raising projects will be gradually put into operation in 2022. While expanding the production capacity of traditional products such as calcium dihydrogen phosphate and ammonium polyphosphate, it will also supplement the production capacity of upstream washing, beneficiation, sulfuric acid and other raw materials, so as to further improve the profitability of the company’s traditional business. In addition, in terms of new energy materials business, the company’s iron phosphate and other new energy materials products will also be gradually put into operation, injecting new power into the rapid growth of the company’s performance.
It is planned to have a capacity of 1.6 million tons of iron phosphate, bind customer resources in advance, and have the advantages of first mover and cost. At present, the company plans to have an annual output of 1.6 million tons of iron phosphate and related supporting capacity, and has signed cooperation agreements with downstream manufacturers such as GuoXuan holdings and Sunwoda Electronic Co.Ltd(300207) for in-depth binding. On the one hand, industrial synergy can be formed between partners to realize product technology exchange, on the other hand, it improves the certainty of the company’s capacity of new energy materials such as iron phosphate. In 2022, the company will take the lead in putting in 200000 tons of iron phosphate production capacity, which ranks in the forefront of the industry and has an obvious first mover advantage. In terms of upstream resources, the overall capacity planning (including built capacity) of the four phosphate mines controlled or participated in by the company reaches 10.5 million tons, and the converted equity capacity is about 8 million tons. Combined with the complete phosphorus chemical industry chain of the company, the cost advantage of the company’s iron phosphate products is significant. In our opinion, considering the current difficulties in the approval of energy assessment and environmental impact assessment and the large-scale cycle of new capacity, the supply and demand of iron phosphate and lithium iron phosphate industry will remain tight in the medium and short term. The company’s relevant capacity will take the lead in large-scale production, which has the advantage of resource cost, and the industry status is expected to improve rapidly. In the long run, with sufficient and high-quality upstream phosphate rock resources and continuously optimized production technology, the company will have strong competitiveness in the follow-up industrial competition.
Profit forecast, valuation and rating: the company’s performance is in line with expectations. We maintain the company’s profit forecast from 2021 to 2023. The company’s net profit attributable to the parent company from 2021 to 2023 is expected to be RMB 323 / 558 / 941 million respectively. We continue to be optimistic that Guizhou Chanhen Chemical Corporation(002895) with the advantages of sufficient high-quality phosphate rock resources and complete phosphorus chemical industry chain, we continue to make breakthroughs in the field of downstream new energy materials, and we still maintain the “buy” rating of the company.
Risk tips: the raised investment project is put into operation less than expected, capacity construction risk, downstream demand less than expected, cooperation landing risk, product price fluctuation risk, environmental protection and safety production risk
