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富临精工(300432):智能电控+锂电正极材料齐头并进

Fulin Seiko (300432): intelligent electronic control + lithium cathode materials go hand in hand

太平洋證券 ·  Aug 29, 2021 00:00

Event: when the company released 21H1 results, H1 achieved operating income of 1.07 billion, an increase of 45.08% over the same period last year; net profit of 160 million, an increase of 10.48% over the same period last year; and 140 million deduction of non-homed net profit, an increase of 10.55% over the same period last year.

1. 21H1 performance analysis: H1 achieved operating income of 1.07 billion, an increase of 45.08% over the same period last year; net profit of 160 million, an increase of 10.48% over the same period last year; and 140 million of non-return net profit, an increase of 10.55% over the same period last year. During the reporting period, the company's performance increased steadily compared with the same period last year, mainly based on the increase in sales revenue of traditional auto parts business over the same period last year, achieving sales revenue of 490 million, + 25.92% of the same period last year. Some new products, such as intelligent electric control, have entered batch delivery, achieving sales of 88.7 million yuan, and sales revenue of lithium cathode materials has reached 126 million, both of which have exceeded the income for the whole of last year, achieving a breakthrough. In the first half of the year, the company's gross profit margin was 30.2%, year-on-year-6.45pct, mainly due to changes in product structure, as traditional auto parts are engine core products, gross profit margin remained at about 35%, while intelligent electronic control business, lithium cathode materials are in the stage of large-scale production expansion, and capacity utilization is low, so gross profit margin has declined. The rate of sales, management, R & D, and financial expenses is 1.96%, 6.79%, 5.68%, 0.37%, compared with 0/-2.59/-2.1/+0.47pct, overall-4.22pct.

2. Intelligent electronic control of new energy vehicles opens new room for growth: the main products of the company's traditional auto parts business are variable valve timing system (VVT), oil control solenoid valve (OCV), variable cam phasor (VCP), variable valve lift system (VVL), etc., which are the core components of the engine with high barriers and a gross profit margin of more than 35%. But the company is vigilant, in the case of stable development of traditional parts and strong profitability, taking into account the future development of new energy and automotive electronics, in 2015 began to gradually layout new "intelligent + new energy" products. Since 2015, continuous trial and error, through independent innovation to promote the upgrading of business from traditional precision machining to intelligent electronic control and mechatronics. According to the annual reports, we found that the company has developed electronic pumps, electronic vacuum pumps, millimeter wave radar, motor controllers, reducers, solenoid valves and other products. After five or six years of accumulation and trial and error, the new energy business has made a qualitative breakthrough, including new energy vehicle main water pumps, solenoid valves, thermal management, and reducers and other products.

Among them, 400W, 450W and 200W electronic water pump series have been mass produced in Geely Automobile and Great Wall Motor, and have been newly designated by Geely Automobile and Great Wall Motor; the electronic water pump actuator has been designated by Volkswagen. The research and development of intelligent thermal management module has passed the customer's summer calibration experiment. The electronic oil pump supplies Huawei series powertrain, and has been designated by XPeng Inc. and Bosch Rexroth through PPAP. The vehicle electric drive reducer has been designated by Huawei and Chinese American Express, the United Electronics (UAES) project has entered mass production and continues to obtain new project locations, and the production line of Huawei project is under commissioning. It is expected that the new energy business will achieve rapid growth in the next three years, which is expected to exceed the traditional business.

3. Lithium cathode materials are powerful: while expanding new energy products, the company also acquired sublimation technology in 2016, laying out the related business of lithium cathode materials. In 2018, due to the poor operation of sublimation's largest customer, Watma, the company encountered a bottleneck in its development. But after several years of creeping, the company took a turn for the better in 2021. In March 2021, strategic investors Ningde Times and Changjiang Morning Road were introduced to jointly increase capital and expand the production line of 50,000 tons of lithium iron phosphate. After the capital increase, Ningde Times and its designated parties hold 8.89% equity interest in Jiangxi sublimation, and Changjiang Morning Road holds 22.78% equity interest in Jiangxi sublimation. So far, it has been built and put into operation. At the same time, benefiting from the rapid development of new energy in China, the company announced on July 21 that it plans to invest in the construction of the second phase of lithium cathode material project, with a planned production capacity of 60,000 tons, and is expected to achieve 2.65 billion after-tax income after reaching production. Since March this year, the company has successively built the first phase of 50,000 tons of production capacity, and began to build the second phase of 60,000 tons of production capacity. The company's cathode materials have entered a stage of rapid growth and have broad prospects.

Investment suggestion: intelligent electronic control + lithium cathode materials go hand in hand. It is predicted that the 22-year return net profit of 21max is 4.2 and 630 million, corresponding to 46 times of 22-year PE.

Risk hint: the sales volume of the automobile industry is lower than expected, the chip affects automobile production, and the speed of capacity construction is not as fast as expected.

The translation is provided by third-party software.


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