Maintain the "overweight" rating. From January to September in 2021, the company achieved operating income of 15.991 billion yuan, up 34.88% from the same period last year, and realized net profit of 2.141 billion yuan, up 43.04% from the same period last year. The company's single-quarter results in the third quarter were in line with expectations. Maintain the company's 2021-23 EPS forecast of 1.30Universe 1.33Universe 1.34 yuan, maintain the company's target price of 11.42 yuan, and maintain the "overweight" rating.
The cost advantage is significant, and the performance has improved steadily. In the first three quarters of 2021, the company's steel sales volume was 89,117 and 1.16 million tons respectively, the gross profit per ton of steel was 973,992,949 yuan per ton respectively, and the corresponding net profit per ton of steel was 621,792,573 yuan per ton, respectively. In the first three quarters, the company's ROE reached 23.5%, up 3.5% from a year earlier. In the fourth quarter, the supply and demand of the iron and steel industry is weak, while the price of raw materials is adjusted more, we believe that the company's profitability will remain good in the fourth quarter.
Adjust the debt structure and keep expenses low. At the end of the third quarter of 21, the company's asset-liability ratio was 55.51%, down 1.41 percentage points from the second quarter. Excluding notes payable, the company's asset-liability ratio remained low. In the third quarter, the company's period expense rate (including R & D) was 2.67%, of which the sales, management and financial expense rates were 0.44%, 2.68% and 0.72%, respectively, down 0.13%, 0.35% and 0.12% from the previous quarter. The company has good incentives and excellent management, and we believe that the company's expenses will continue to be optimized.
The company passes through the cycle through a low-cost expansion strategy. Under the background of carbon neutralization, the growth logic of the industry or company has been switched to the endogenous growth of individual "fine management to reduce costs". The company adopts a unique low-cost expansion strategy to achieve capacity expansion and value creation through continuous output management through epitaxial mergers and acquisitions. We believe that the company's production capacity and performance will achieve fluctuating growth.
Risk tips: a sharp macroeconomic downturn; unpredictable safety accidents.