Company trends
Recent situation of the company
On December 6, the company announced that it would change its short name from "Yanzhou Coal" to "Yanzhou Energy" on December 9. On December 15, the company issued the "Strategic Development outline" to determine five industrial development directions, in which it is proposed to strive to increase coal production to 300 million tons / year and chemical products to 2000 million tons / year in the next 5-10 years. We believe that the outline is expected to lay a solid foundation for the company's medium-and long-term development. If the company can land smoothly, the scale of the company's main coal industry is expected to be significantly improved, and the types of mines will be more rich and diverse. In addition, the development of chemical industry, new energy and high-end equipment manufacturing also helps the company to transform and upgrade to green, low-carbon and intelligent.
Comment
The company's outline proposes to determine the development direction of mining, high-end chemical new materials, new energy, high-end equipment manufacturing and intelligent logistics on the basis of existing industries. The main development objectives include: 1) substantial expansion of the mining industry: strive to achieve a coal output of 300 million tons per year in 5-10 years (the company's coal output in 2020 is 120 million tons), build 8 green intelligent mines of more than 10 million tons, and expand molybdenum, gold, copper, iron, potassium and other minerals on the existing non-coal mineral assets to realize the transformation from single coal mining to multi-mine development. If the above planning goes smoothly, the company is expected to become the second largest listed coal company in China after China Shenhua Energy in terms of coal output in the future. 2) expand the scale of the coal chemical industry and actively develop new high-end chemical materials: extend the existing chemical industry chain and strive to produce more than 20 million tons of chemical products in 5-10 years (4.58 million tons in 2020), of which new chemical materials and high-end chemical products account for more than 70%. The draft of the Central Economic work Conference released on December 10 proposed that it is necessary to do a good job in the clean and efficient use of coal, and that the use of raw materials will not be included in the control of total energy consumption. We believe that the above mentioned contents mentioned in the working meeting are also expected to be beneficial to the development of the company's coal chemical industry. 3) promote the new energy industry and develop hydrogen production business: promote the development and construction of new energy industry projects such as wind power, photovoltaic and supporting energy storage, and strive to achieve more than 1000 million kilowatts of new energy power generation in 5-10 years. In addition, relying on the existing coal chemical industry and developing hydrogen production business, we will strive to supply more than 100,000 tons of hydrogen in 5-10 years. 4) develop high-end coal equipment manufacturing, expand new energy equipment manufacturing: develop traditional superior products such as high-end coal machinery manufacturing on the basis of the existing equipment manufacturing industry, expand fan and other new energy equipment manufacturing, and cultivate medium-and high-end products. 5) develop intelligent logistics: construct intelligent logistics system.
Valuation and suggestion
Taking into account the expected improvement in coal production and cost next year, we raised our profit forecast for 2022 by 9% to 17 billion yuan. In the short term, the company's coal production and sales in November are still lower than the same period last year, indicating that production in the fourth quarter is still under pressure, and we have lowered our 2021 profit forecast by 6% to 18.8 billion yuan. Keep the neutral rating unchanged. The current A share price corresponds to 2021/22eP/E 7.0x / 7.7x and H share price corresponds to 2021/22eP/E 4.1x/4.7x. Taking into account the change in valuation to 2022 and the difference in the performance of A / H shares, we raise the target price of A / H shares by 31% to 30 yuan / 19 yuan, which implies 12% upside space compared with the current share price, corresponding to 2021 shock 22e A shares P shock E is 7.8x/8.6x, corresponding to 2021122e H shares P hand E is 4.3x/5.0x. The target price of A / H shares is raised by 31% to 30 yuan / 19 yuan, which implies 7% upside space compared with the current share price.
Risk
The prices of coal and chemicals fell more than expected.