Event: the company released its annual report for 2021, with operating income of 18.977 billion yuan, year-on-year + 51.45%, total net profit of 2.654 billion yuan, + 354.56%, deducting non-net profit of 2.673 billion yuan, + 567.10%. Among them, Q4 achieved 5.66 billion yuan in operating income in a single quarter, + 82.98% in the same period last year, and 1.053 billion yuan in net profit, + 172.06% in the same period last year. At the same time, it is predicted that Q1 will achieve a return net profit of 11.5% to 1.25 billion in 22 years, which is + 313% to 349% compared with the same period last year.
The prices of the main products have risen sharply, and the business performance has reached a new high. In 2021, due to the influence of geopolitics, the continuous fermentation of the COVID-19 epidemic and other factors, commodity prices soared. The average prices of metal silicon, organosilicon, and glyphosate in 2021 were 23,000 yuan / ton, 32,000 yuan / ton and 48000 yuan / ton, respectively, up 95%, 70% and 106% from the same period last year. Based on the original industrial basis of recycling chlorine, silicon and phosphorus, the company gives full play to the advantages of the integration of the whole industry chain, actively expand the upstream and downstream market share, product sales have increased significantly, and business performance has reached a new high.
The advantage of integrated operation is highlighted, and the proportion of terminal business is gradually flattened out. The company revolves around the silicone business to carry out "industrial chain upward, value chain promotion, supply chain coordination" to achieve upstream metal silicon self-supply, downstream middle and high-end product development, the company's terminal business into the fast lane. During the reporting period, the business income of the company's silicon-based terminals and special silane products reached 3.204 billion yuan, an increase of 69% over the same period last year, the terminal conversion rate reached more than 40%, and the middle and high-end products accounted for 44% of the terminal products. By the end of 2021, the company has nearly 3000 varieties of silicone terminal products, and the carrier value of the terminal subsidiary is prominent. at the same time, the company actively arranges the new energy track, with a production capacity of 65000 tons of trichlorosilicon and 30,000 tons of photovoltaic sealant. In terms of industrial integration, the company currently has an industrial silicon production capacity of 100,000 tons per year, in addition to the 100,000 tons / year new production capacity under construction in Yunnan Yanjin, recently landed in Pingwu, Sichuan Province, 65,000 tons / year construction projects and Yunnan Jingcheng 54,000 tons / year acquisition projects, then the company's industrial silicon production capacity will reach more than 300,000 tons / year, at the same time, the company has 80 million tons of silicon reserves in Yunnan Yanjin. At present, the first phase of the project has reached full production.
With the continuous advancement of the integrated layout and the increase in the proportion of end products, the corporate cycle attribute is expected to be gradually weakened.
Glyphosate scene demeanor continues to be high, the company's profits are expected to maintain a high level. Since 2020, the global prices of agricultural products have been rising continuously, and the planting enthusiasm of downstream farmers has increased, leading to a collective rise in the prices of agriculture-related products. After the supply-side reform in the past few years, the concentration of the glyphosate industry has increased significantly. It is the peak season of procurement, and the demand in overseas markets is strong, and the relationship between supply and demand is tense.
At present, the market price of glyphosate in East China is 64,000 yuan / ton, and the product price difference maintains a high level. The company is a domestic glyphosate industry leader, the existing glyphosate raw drug production capacity of 80,000 tons / year, is expected to continue to maintain a good profit level.
For the first time, coverage gives a "buy" rating. The company deeply ploughs the two major industries of phosphorus and silicon, and the current industrial prosperity continues to be high, with strong profitability. At the same time, with the continuous promotion of the company's integration strategy and the continuous increase in the proportion of end products, we have opened up a "third battlefield" with the application of new energy as the main scene. in the long run, the growth attribute of the company continues to strengthen, and the cyclical attribute is expected to be gradually weakened. It is expected that the company will achieve a net profit of 3.49 billion / 4.48 billion / 5.53 billion in 22-24, with a net profit of 3.49 billion / 4.48 billion / 5.53 billion, EPS4.27/5.47/6.75 yuan, corresponding to PE6.4/5.0/4.1 times, with a "buy" rating for the first time.
Risk tips: product prices fall, raw material prices fluctuate, and project progress falls short of expectations.