Event: Xin'an shares issued an annual performance advance announcement for 2021. During the reporting period, the net profit attributed to shareholders of listed companies was 2.6 billion yuan to 2.7 billion yuan, an increase of 2.015 billion yuan to 2.115 billion yuan over the same period last year, and an increase of 344% to 362% over the same period last year. During the reporting period, the deduction of non-recurrent net profit belonging to shareholders of listed companies was 2.6 billion yuan to 2.7 billion yuan, an increase of 2.199 billion yuan to 2.299 billion yuan over the same period last year, or 548% to 574% over the same period last year. Among them, Q4 realized net profit of 999 million yuan to 1.099 billion yuan attributable to shareholders of listed companies in 2021, an increase of 131%, 154%, 31.62%, 44.80%, and 31.62% compared with the same period last year. Q4 realized deducting non-recurrent net profit of 1.015 billion yuan to 1.115 billion yuan for shareholders of listed companies in 2021, an increase of 261%, 297% and 34%, respectively.

Maintain the investment rating of "prudent overweight". Xin'an Co., Ltd. is a leading enterprise of organosilicon monomer and glyphosate in China, which forms the coordination of two industries with crop protection and new silicon-based materials. In addition, the company's silicone has the advantage of the whole industry chain, the existing silicone monomer production capacity of 490,000 tons / year, can produce downstream raw rubber, liquid rubber and other terminal products. The company's silicone business has developed to high-end areas, focusing on downstream high-value areas such as electric power communications, rail transit and automotive, health care, electronics and new energy. The company actively supports the upstream metal silicon production capacity, and the company is building metal silicon production capacity and putting into production in the future, which will help to improve the stability of silicone business performance. The company continues to optimize its product structure, and projects under construction include glyphosate, phosphorus series flame retardants and new flame retardant materials, etc., and the plant protection plate and new material product line will be gradually extended in the future. We raised the company's profit forecasts for 2021-2023 with EPS of 3.25,3.43,3.74 yuan respectively, and maintained a "prudent overweight" rating.

Risk hint: the risk of raw material price fluctuation, the risk that the production of new projects is not as expected, and the risk of downstream expansion is not as expected.