Core viewpoints
Performance will grow by 75% in 2021. Shunbo alloy announced its 2021 results. The company's operating income in 2021 was 9.985 billion yuan, an increase of 105.1% over the same period last year. The net profit returned to its mother was 342 million yuan, up 74.7% over the same period last year. The net profit from non-return to home was 243 million yuan, an increase of 32.9% over the same period last year. Net cash flow from operating activities was-969 million yuan, down 367.6% from the same period last year. There is a big difference between the net cash flow and net profit generated by the company's operating activities, mainly due to the company's cash purchase of raw materials, the sales end gives customers a certain credit period, superimposed the rapid expansion of the company's production and marketing scale and the rise in aluminum prices, resulting in a larger scale of accounts receivable.
The company continues to have a high turnover and stable profitability. The company continues the advantage of high operating turnover efficiency. Under the condition of the industry characteristics of "material heavy industry light" and relatively constant profits in processing links, the company maintains efficient operation efficiency through fine management of the whole business chain, and the company's ROE will rise steadily in 2021. Thanks to the strong demand downstream and the putting into use of the company's production base in Laohekou, Hubei, and the expansion and rationality of the sales radius, the company achieved a sales volume of 598000 tons of recycled alloys in 2021, an increase of 62.9% over the same period last year. At the same time of the high growth of production and sales, the company's profit per ton of products remained stable. Without considering the entrusted processing business, the rough calculation company made a profit of 842 yuan per ton of recycled aluminum wool in 2021, which is basically the same as the profit level of the past few years.
Layout recycled aluminum ahead of time to avoid grade utilization and open up room for future growth. On the basis of developing the foundry aluminum alloy business, the company acquired 100% equity of Chongqing Aobo Aluminum material Manufacturing Co., Ltd in November 2021, initially cut into the larger deformed aluminum alloy application market, and complied with the development trend of the industry. speed up the promotion of waste aluminum resources grade utilization, to create a "cast aluminum alloy raw material supply + deformed aluminum alloy raw material supply" business two-wheel drive.
Risk hint: the company's new capacity production progress is not as expected, downstream demand weakening risk.
Investment advice: maintain the "overweight" rating.
Assuming that the domestic price of recycled aluminum alloy ingots remains at the 2021 level, the company's average annual sales price of recycled aluminum alloy ingots excluding tax in 2021-2023 is 16488 yuan / ton, and the gross profit per ton of the company's aluminum alloy products remains at the 2021 level. It is estimated that the company's revenue in 2022-2024 will be 121 shock 151 / 18.8 billion yuan respectively, a year-on-year growth rate of 21.4 million 24.5 million 24.6%, and the net profit of 3.98pm 4.83 / 592 million yuan respectively. Year-on-year growth rate 16.3, 21.4, 22.5%. Diluted EPS= 0.91 pound 1.10 pound 1.35 yuan, the current share price corresponds to PE=13.3/11.0/8.9X. Considering that the company is the leading domestic recycled aluminum production enterprise, the company's capacity layout is reasonable, the production capacity is expanding steadily, and the recycled aluminum is reused in advance to open up the space for future growth. The company will fully benefit from the accelerated development of the recycled aluminum industry and maintain its "overweight" rating.