3Q21 performance exceeded market expectations
The company announced 1-3Q21 results: revenue was 33.55 billion yuan, down 9.4% from the same period last year; net profit was 3.01 billion yuan, up 45.6% from the same period last year, the highest level in history. 3Q21 achieved a net profit of 1.16 billion yuan, the highest in the third quarter of a single history. Considering that 3Q21 recognized an impairment loss of about 440 million, the actual operating performance was even better. The company's 3Q21 performance exceeded market expectations, mainly due to the increase in the delivery volume and proportion of sea wind and land wind high-power models, as well as the excellent profit margin performance of the fan business.
The fan sales structure of 3Q21 Company is optimized, and the momentum of new fan orders is better than that of 1H21. 3Q21 company sells fan 3381MW, among which 6hammer8S platform 692MWMagne3Company4S platform 1359MWMagne2S platform 1286MWJE3 MW and above account for 60% of the power. 1-3Q21 company new fan orders about 6.6GW, of which 3Q21 company new orders about 3.4GW, the number of orders has been accelerated than 1H21. By the end of 3Q21, the company has ordered the hand fan 16.4GW, in which the company's new medium-speed permanent magnet platform products have reached 670MW.
Maintain the sustained and healthy development of power plant business. 1-3Q21 company self-operated wind farm power generation hours of 1896 hours, 3Q21 of 504 hours, the third quarter is the weak wind season. 3Q21 transferred the 200MW of the power station, and at the end of the period, the cumulative grid-connected capacity of the self-operated power station was about 5.5GW, and the capacity under construction was about 2.4GW. 1-3Q21 company transfers wind farm 473MW Magi 3Q21 to 200MW. At the end of the period, the cumulative grid-connected capacity in operation is about 5.5GW, and the capacity under construction is about 2.4GW.
Development trend
Under the upward trend of the industry, the company's shipments are expected to return to the growth trend from 2022. Due to the obvious cost reduction brought about by the technological progress of onshore wind turbines and the promotion of support policies for the superimposed industry, we expect that it is possible to achieve a higher installed capacity of wind power in 2023, and the high economic cycle has already started. With its excellent product quality reputation and years of accumulation in the upstream parts supply chain, Jinfeng superimposes the company's newly launched high-power and medium-speed permanent magnet platform fan products, we expect the company's shipments to return to the growth trend in 2022 and continue to lead the industry.
Profit forecast and valuation
As we are more optimistic about the profit margin of the company's wind turbine business, we have raised the company's net profit of 2021 Universe in 2022 by 5.6% to 4.092 billion yuan / 4.293 billion yuan. The company's current A-share price corresponds to a price-to-earnings ratio of 18.9 times 2022 / 18.1 times earnings. The current H-share price corresponds to a price-to-earnings ratio of 15.5 times 2022 / 14.7 times earnings for 2021 Universe. We maintain the company's A-share and H-share outperform industry ratings, as we have raised the company's profit forecast and are more optimistic about the economic trend of the wind power industry, raising the company's A-share target price by 10.2% to 21.60 yuan corresponding to 21.3 times 2022 price-to-earnings ratio, which has 17.8% upside compared to the current stock price. Raising the company's H-share price by 11.7% to HK $23.68 corresponds to 20.0 times 2022 price-to-earnings ratio, which has 35.8% upside from the current share price.
Risk
The demand for wind power installation is lower than expected, and the rising cost of spare parts affects profit margins.