\u3000\u3000 Hunan Zhongke Electric Co.Ltd(300035) (300035)
Q4 performance improved month on month, and single ton profit crossed the inflection point
2021q4 is expected to realize a net profit attributable to the parent company of 93-142 million yuan, with a year-on-year increase of + 82% – 178% and a month on month increase of + 2% – 56%; It is expected to realize a net profit of 75-121 million yuan, with a year-on-year increase of + 55% – 150% and a month on month increase of – 16% – 36%. The net profit attributable to the parent company / net profit deducted from non attributable to the parent company of the performance center increased by 130% / 103% year-on-year and 29% / 10% month on month respectively. Assuming that the net profit of electromagnetic equipment business is about 7.5 million, considering the goods preparation and goods in transit at the end of the year, the net profit center of Q4 negative pole per ton is expected to be 5800 yuan / ton, with a month on month increase of 04-05 yuan / ton.
The negative pole is the first to be put into production, and graphitization is about to keep up with the pace
In order to seize the market share, the company took the lead in putting into operation the pre / post process of negative electrode in 2021. The effective capacity of negative electrode in 2021q4 has been close to 23000 tons, the effective capacity of graphitized equity is about 6000 tons, and the self supply rate is 28% (down 8pct month on month in Q3). In addition, under the pressure of raw materials, the profitability of single ton can still be repaired month on month. It is expected that the price transmission mechanism has played a role. The company’s graphitization capacity of 30000 tons in Guizhou / 15000 tons in Sichuan is about to be put into operation, and the self supply rate is expected to increase quarter by quarter. The current round of industrial expansion is expected to be released at least by the end of 2022. The easing of the contradiction between supply and demand this year is still very limited, and the probability is still in a tight balance between supply and demand. The industrial chain has basically established a price linkage mechanism, and the transmission of cost pressure to the downstream is expected to be more effective.
The trend of negative pole pattern concentration remains unchanged, and the company’s market position has been advanced
The downstream of graphitization also includes steel-making and other industries. As a high energy consuming link, it is likely to get the approval of energy evaluation to expand production alone. The company reduces unit energy consumption through technology and process, and has greater advantages in production efficiency. The integrated expansion of production is supported by Sichuan, Guizhou, Yunnan and other local governments. It will actively cooperate with the reply of environmental impact assessment and energy assessment, and give preferential policies for power protection and other industries. The company cooperates with Eve Energy Co.Ltd(300014) to plan the integrated production capacity of 100000 tons in Yunnan, and cooperates with Gui’an new area to expand the production capacity of 100000 tons of negative electrode integration project. The 14th five year plan has disclosed that the negative electrode production capacity is planned to be about 350000 tons / year (equity) and the graphitization production capacity is 295000 tons / year (equity 236000 tons / year), and the market share is expected to be further advanced.
Profit forecast and valuation
It is estimated that the company’s performance from 2021 to 2023 will reach 378 / 834 / 1193 million yuan, pe52 / 23 / 16 times, and maintain the “buy rating”.
The risk indicates that the production capacity is not up to expectations, and the sales volume of electric vehicles is less than expected.
