Event: according to the semi-annual report released by the company, 2021H1 achieved operating income of 345 million yuan, down 56.1% from the same period last year; net profit from its mother was 36.75 million yuan, up 244.28% from the same period last year; and net cash flow from operating activities was 258 million yuan, an increase of 220.48% over the same period last year.
Lithium battery materials, equipment and engineering have become the company's largest business. Baili Technology is a scientific and technological engineering company specializing in engineering consulting, design and general contracting, mainly serving petrochemical, modern coal chemical and other industries, has undertaken more than 3500 projects. In 2017, the company acquired Nanda Zijin Lithium Power, and officially cut into the lithium material equipment and engineering industry.
Nanda Zijin specializes in the design and manufacture of lithium battery positive and negative materials production lines to provide integrated automated production solutions for lithium battery and other new materials enterprises. After the development in recent years, Nanda Zijin Lithium Power has accumulated rich industry performance and proprietary technical force in the industry, and occupies a dominant position in the domestic lithium battery material production line design and manufacturing field. The company has many years of factory design experience, and Nanjing University Zijin Lithium Power is well complementary. Since 2018, the proportion of lithium materials related business has increased year by year. In 2020, the proportion of lithium materials related business has reached more than 85%, becoming the company's largest business.
Lithium cathode materials are of high quality and wide range of customers. Nanda Zijin has accumulated in the field of cathode materials for many years, and its customers are excellent. According to the company announcement, customers include Dangsheng, Palmer, Shanshan and Betteri, etc. The above-mentioned material enterprises have an important industry position in the cathode material market, and the company can cooperate closely with most well-known enterprises in the industry, which shows that the company has an important industry position in the design, manufacture and engineering of lithium cathode material production line. Since 2021, the explosive growth of the new energy vehicle industry has far exceeded the industry expectations. As a result, many lithium battery materials are in short supply, and the price rises sharply, at the same time, it also stimulates the rapid expansion of the industry, among which the cathode materials (lithium iron phosphate and high nickel ternary) have millions of production expansion plans, corresponding to tens of billions of investment.
Since its establishment, Nanjing University Zijin has built more than 100 cathode material production lines. With its excellent technical level and rich experience, especially in the design and construction of high nickel ternary production line, it will fully benefit from this round of expansion of lithium materials. According to the 2021 semi-annual report, the company's newly signed lithium business orders exceeded 1.5 billion yuan in the first half of the year, and lithium plate orders exceeded 2 billion yuan.
In the future, with the landing of downstream customer expansion, the company's lithium business will maintain rapid growth.
Layout of fuel cell proton exchange membranes. At present, lithium battery is the main energy storage device for new energy vehicles all over the world. At the same time, governments and many well-known enterprises are also vigorously promoting fuel cells as on-board or electric devices. Proton exchange membrane as the core material of fuel cell, the domestic market basically depends on imports. Shanghai Baikun, a subsidiary of the company, has formally signed the membrane electrode Development and Global Licensing Cooperation Agreement with BASF, Germany, and will devote itself to the research, development and utilization of high temperature proton membrane (HT-PEM) and membrane electrode (MEA), as well as the manufacture of membrane electrode assembly (MEAs), which will speed up the gradual realization of domestic substitution and industry chain integration of hydrogen fuel cell core materials. The high temperature proton exchange membrane electrode technology of hydrogen fuel cell is popularized and applied together. The new generation of phosphoric acid doped polybenzimidazole high temperature proton exchange membrane developed by the company has high molecular weight, mechanical strength, proton conductivity and operating life.
Investment advice: the rapid growth of global new energy vehicles, lithium battery core materials in short supply, greatly promoting the expansion of lithium battery materials. As the core partner of lithium materials equipment and engineering, the company will fully benefit. It is estimated that the net profit of the company from 2021 to 2023 is 155 million, 331 million and 501 million respectively, and the corresponding EPS is 0.32,0.68,1.02 yuan respectively. The PE corresponding to the current share price is 53 times, 25 times and 16 times respectively, giving a "overweight" rating for the first time.
Risk tips: 1. Policy risk. 2. The research and development of new products is lower than expected. 3. Financial risk.