2021 homed net profit + 46% compared with the same period last year
FAW Jiefang released its 2021 results report on March 30: operating income was 98.75 billion yuan,-13% year-on-year, and net profit was 3.9 billion yuan, + 46% year-on-year. The company's return net profit is lower than Huatai's forecast (4.1 billion yuan). We think the company's performance is lower than expected mainly due to the decrease in heavy truck sales. 4Q21's revenue was 10.15 billion yuan,-37% year-on-year, and its net profit was 330 million yuan, + 1490% year-on-year. We estimate that the EPS of the company in 2022-2024 will be 0.96 Wind 1.01max 1.19 yuan respectively, and the average PE of comparable company will be 12.3x in 2022. Based on the 12x 2022E PE, we give the company a target price of 11.52 yuan and maintain the "overweight" rating.
4Q21 operating quarter-on-month improvement
According to the announcement, 4Q21 has a gross profit margin of 18.9% (4Q20VORT 3.5% Bing 3Q2112.9%), a sales expense rate of 0.7% (4Q20 Rue 10.4% TX 3Q21VR 3.7%), and an administrative expense rate of 8.4% (4Q20:
6.1% cross 3Q21rig 5.0%), R & D expense rate 14.2% (4Q20V 7.2% cross 3Q21v 6.5%), net return 3.3% (4Q20v 0.1% sheng 3Q21v 3.0%). We believe that the company's 4Q21 operating performance is better than the previous month, mainly due to the improved profitability brought about by product upgrades.
Product structure is developing towards high-end and new energy.
According to the announcement, the 2021 company sold 373000 medium-and heavy-duty trucks, 65000 light trucks, and 905 buses,-7 percent year-on-year. In 2021, the company's heavy truck sales market share of 23.7%, year-on-year + 1.5pct, ranking first in domestic sales for five consecutive years. The company's product structure continues to develop towards high-end and new energy. In 2021, the sales of its high-end heavy truck model J7 increased by 84% compared with the same period last year, continuously improving the market reputation; the company completed the trial production and testing of light hybrid and pure electric products. Heavy-duty electric tractors and pure electric dump trucks were mass produced, and the company sold 2228 new energy products in 2021, + 16% year on year.
Maintain the "overweight" rating
Considering that the company's performance is lower than expected, we will reduce the gross profit forecast for 2022-2023 by 0.5 pct to 13.9%, and the home net profit forecast by 3.1% to 4.47 billion yuan, respectively. We expect the company to make a net profit of 5.56 billion yuan in 2024. Comparable Wind unanimously expects the average PE to be 12.3x (11.6 x 2021E PE) in 2022. In view of the short-term pressure on the company's sales, we give the company a target price of 11.52 yuan (the previous value is 14.40 yuan) based on 12x 2022E PE (the previous 16x 2021E PE), maintaining the "overweight" rating.
Risk hint: sales of heavy trucks fall short of expectations; profit margins fall short of expectations.