Event: on April 13, 2022, the company released a forecast of first-quarter results. The company expects to make a profit of 240 million yuan to 300 million yuan in the first quarter of 2022, an increase of 136.70% 195.88% over the same period last year.
Volume and price have risen, subsidies have been confirmed, and performance has increased significantly. According to the announcement, there are two main reasons for the sharp increase in the company's performance: first, the company focuses on the development of the main industry, takes many measures to deeply tap the production potential, and strengthens the market development, so as to achieve a steady increase in the unit price, sales volume and sales income of coalbed methane in the first quarter; second, the actual receipt and confirmation of coalbed methane subsidies increased significantly in the first quarter compared with the same period last year. Due to the uncertain time for the company to receive coalbed methane subsidies during the year, and the uneven amount of coalbed methane subsidies in each quarter, the company actually received and confirmed 175.0826 million yuan of coalbed methane subsidies in the first quarter of this year.
With the triple advantages of resources, technology and channels, the production of coalbed methane is expected to continue. (1) the company is rich in coalbed methane resources, and gas well construction promotes production growth: the company has proven coalbed methane reserves of 20.5 billion cubic meters, has 3305 coalbed methane wells, and is rich in resources; and with the exploration of new mining areas and the commissioning of mines under construction, production is expected to increase rapidly. (2) the company leads the domestic coalbed methane production technology: the company's technology accumulation in the theoretical research and practical operation of coalbed methane is in the leading position in the country. (3) enhance the gas supply capacity of the pipeline, improve the utilization rate of coalbed methane, and promote the growth of performance: with the layout of the company in the coal seam pipe network, the subjective emptying rate of coalbed methane will continue to decline, which will lead to the growth of the company's performance.
With the rise in oil and gas prices, the company's comprehensive price is expected to rise. Under the influence of strong overseas demand and the repeated situation in Russia and Ukraine, overseas oil and gas prices have risen sharply. According to wind, the average price of 22Q1 Brent crude oil rose 65.26% year on year to $100.87 per barrel, while the average 22Q1 price of NYMEX natural gas was $4.57 per million British thermal units, an increase of 67.91% over the same period last year. Driven by overseas prices, domestic LNG prices have also risen sharply. According to Wind data, LNG prices in Jincheng, Shanxi Province, where 22Q1 is located, rose 73.62% year on year. As a result, the company's comprehensive price is expected to rise.
Investment suggestion: under the "double carbon" goal, low emission intensity energy instead of high emission intensity energy is an effective way. As an unconventional natural gas, the carbon emission intensity of coalbed methane is lower than that of coal and oil. As a national backbone enterprise of coalbed methane extraction and utilization, large-scale extraction and utilization of coalbed methane will play an important role in reducing greenhouse gas emissions and achieving the goal of "double carbon". We estimate that the return net profit of the company from 2021 to 2023 will be RMB 305Comp687000000000, the corresponding EPS is 0.32Universe 0.71, and the corresponding PE on April 13th, 2022 is 25, 11 and 10 times, respectively. Maintain the recommended rating.
Risk hints: the risk of slow exploration and mining of new mines; the risk of falling coalbed methane prices; the risk of insufficient policy support.