Event: on September 22, 2021, the company issued a notice on investing in the construction of a lactide project with an annual output of 30,000 tons, with a total investment of 586.9383 million yuan and a construction period of 24 months from the date of approval of the project to the successful commissioning of the project. the construction site is Wukeshu Economic and technological Development Zone, Yushu City, Jilin Province.
"carbon neutralization" social construction needs new materials-1 million tons of polylactic acid raw material gap to be filled by 1 million tons of lactide polylactic acid (PLA) is a completely degradable bio-based material with a wide range of applications, carbon dioxide emissions can be reduced by 60% compared with ordinary plastics. Due to the plastic restriction efforts to strengthen the superposition of "carbon neutralization" era is coming, the industry has entered a period of rapid development. According to the data of the National Development and Reform Commission and the Department of Environmental Resources, the annual production capacity of PLA in China will be about 100000 tons in 2020, and it is estimated that by 2025, the annual production capacity of PLA in China will be more than 1 million tons.
Lactide is a key raw material in the production process of polylactic acid. As an important monomer in the synthesis of polylactic acid, how many tons of lactide can be obtained determines how many tons of polylactic acid can be produced by Chinese enterprises. According to the data of Jindan science and technology, one unit of L-lactide synthesizes 0.95 units of polylactic acid, which shows that there is a gap of million tons of lactide in our country. According to the data of the Professional Committee of degradable Plastics of China Plastics Association, from September 2020 to August 2021, the average transaction price of PLA in China is about 28000 yuan per ton. we expect that by 2025, the market size of PLA in China will be nearly 30 billion yuan, which will generate a lot of demand for lactide.
Domestic polylactic acid production enterprises rely on imports for a long time, but there are only three international enterprises capable of producing lactide. China's lactide is subject to the production capacity and supply willingness of international suppliers. Thus it can be seen that the domestic companies that can get through the lactide link will be the first to break this situation and become the leading enterprise of the domestic polylactic acid track. As of September 2021, domestic lactide design and operation capacity is still small. As of September 22, Jindan Technology was the only listed company to disclose that it had a design capacity of 10,000 tons of lactide per year. According to its mid-2021 report, the progress of the project was 98%.
Cofco Science and Technology plans to build a lactide project with an annual output of 30,000 tons-why are we optimistic that the company can become a leader?
Since 2005, the company has cooperated with domestic and foreign enterprises and scientific research institutions to study biodegradable materials. After 15 years of research and development and industrialization, the company starts from the downstream application market of polylactic acid products and continues to extend to the upper reaches of the industrial chain. At present, the company has a series of production technologies of starch / starch sugar, lactic acid, lactide and polylactic acid, and successfully realized the industrial application of polylactic acid in Changchun, Jilin Province, and accumulated rich production experience. In the production of lactide, the company has overcome a series of technical problems in the production process of lactide, such as low production efficiency, high system viscosity, strong corrosion and so on. The company has formed more than 70 invention patents in the field of production and application of polylactic acid industry chain. In addition, through the industrialization practice of corn deep processing industry in the past 30 years, the company has a deep corn processing industry foundation, a complete scientific and technological R & D and innovation system, and a long-term cooperative relationship with domestic and foreign enterprises and scientific research institutions. The establishment of a stable operation of polylactic acid industrialization demonstration equipment provides an important guarantee for the project construction.
Profit Forecast & Investment suggestion: we expect that from 2021 to 2023, the company will achieve a revenue of 271.93pm 288.39max RMB 30.955 billion and a net profit of 11.10 / 1570pm RMB 2.060 million, corresponding to EPS0.59/0.84/1.10 yuan per share. Maintain a "buy" rating.
Risk tips: risk of fluctuation of raw grain / crude oil prices, uncertainty of epidemic situation, and poor progress of the project.
