Event: 2021H1 realized operating income of 2.351 billion yuan, year-on-year + 36.66%; net profit of 455 million yuan, + 98.69%; deduction of non-return net profit of 429 million yuan, + 101.91%. From a quarterly point of view, Q1/Q2 realized revenue of 1.096 billion yuan, 26.45% compared with the same period last year, and net profit of 217,000,000 yuan, 64.4%, and deducted non-parent net profit of 2.096 million yuan, 26.45%, 217,238 million yuan, 64.4%, 2.08 billion yuan and 67.86%, respectively.
The release of production capacity has been accelerated and the performance has increased rapidly. The company has a production capacity of 2020 Della rods for 8.5GW, and is expected to reach more than 20/30GW by the end of 2022. The company's production capacity is expanding rapidly. At present, Sichuan Leshan Phase I 12GW pull rod cutting capacity has been successfully ignited in July and is in the climbing stage, which is expected to be completed in November. The company has announced plans to put into production projects including Wuhai Phase II 10GW, Leshan Phase II 12GW is in steady progress, and the new capacity is expected to be released one after another in 2022-2023. It is expected that the company's annual shipments will reach 12GW (Wuhai 8GW + Leshan 4GW), and its performance is expected to double.
The management ability has been strengthened and the profit level has been continuously improved. 2021H1 gross profit margin year-on-year + 9.83pcpts to 43.41%, net margin year-on-year + 6.04pcpts to 19.35%. Among them, 21H1's gross profit margin of silicon wafer production reached 30%, and its profitability is comparable to that of first-tier manufacturers. The main reason is that as one of the leading enterprises in the production of single crystal furnace equipment, the transformed wafer manufacturer has multiple advantages. One is the reduction of unit cost brought about by the expansion of the company. Second, as an equipment supplier, the company has supporting small-scale production, the company has rich experience in pull rod production, and there is room for cost reduction in fine management. Third, the technical advantages of self-supplying equipment. The company's single crystal furnace is completely self-supplied, which facilitates timely communication between production personnel and equipment personnel, and can ensure equipment renewal and optimal production status.
Sign a long order with the battery manufacturer to lock the downstream customers. The company signed long wafer purchase orders with battery manufacturers Tongwei Solar and Jiangsu Runyang respectively, of which Tongwei plans to purchase 960 million single crystal wafers from the company in 2021-2023, and Runyang plans to purchase 946 million single crystal wafers from the company in 2021-2023. The price adopts the way of monthly bargaining, it is estimated that the long orders of the two major customers can cover at least 50% of the company's production capacity, and the company's long-term orders are guaranteed.
Investment advice: it is estimated that the net profit of 2021, 2022, and 2023 will be 10.6, 14.9 / 1.87 billion yuan, respectively, corresponding to PE 21.6, 15.3, 12.1, maintaining the buy rating.
Risk tips: downstream photovoltaic installation is not up to expectations; the company's production expansion growth is not up to expectations; abnormal fluctuations in raw material prices led to the company's performance below expectations.
