This report is read as follows:
The company operates steadily and smoothly in the first quarter, continues to reduce costs, increase efficiency and improve quality, and is expected to achieve a rise in volume and profit; in the medium and long term, the strategic layout of the company's products is forward-looking, and we believe that the company will benefit from the high demeanor of strategic products in the future.
Main points of investment:
Maintain the "overweight" rating. According to the performance of KuaiBao, the company achieved revenue of 133.4 billion yuan in 21 years, up 67% from the same period last year, and the net profit returned to its mother was 7.024 billion yuan, up 293% from the same period last year. Taking into account the sharp rise in raw material prices and global inflation expectations and other factors, the 21-23 return net profit forecast will be reduced to 70.24x80.81 / 8.53 billion (the original 83.80x94.48x746 million), maintaining the target price of 7.98 yuan and maintaining the "overweight" rating.
The proportion of high-end products is improved, and the product quality is optimized. The output of high-end products such as high-grade non-oriented steel, new energy automobile steel and ultra-thin oriented electrical steel of 2022Q1 Company has increased by 15%, 72% and 19% respectively compared with the average output of the 21st quarter, and a new breakthrough has been made in the production, supply and marketing of high-end products. At the same time, the company's product quality continues to improve, breaking through a number of certifications, such as galvanized ultra-high strength steel certified by BMW and SAIC Volkswagen, 9Ni steel certified by NK Classification Society and so on. With the batch supply of newly certified products, its product structure will continue to be optimized.
Remarkable achievements have been made in reducing costs and improving efficiency, and it is expected to achieve a simultaneous increase in volume and profit. The company continues to optimize the production equipment and process of drawing leveling, pickling, continuous annealing and other links, so as to improve the production efficiency of the whole process. In January 22, the company's monthly output increased by 11.7% compared with the all-time high, and the production efficiency increased significantly. At the same time, the company continues to promote cost reduction work, its per ton steel depreciation and ton steel costs have ushered in an inflection point, showing a significant downward trend, we believe that the company is expected to achieve both volume and profit in the future.
The product strategy is forward-looking and the performance will be released gradually. High-end electrical steel is the company's key strategic product, its "new energy automobile electrical steel project" has entered the commissioning stage, is expected to be put into production in June 22, when its electrical steel production capacity will be greatly increased; the proportion of the company's high-end electrical steel will continue to increase during the 14th five-year Plan period. We believe that the penetration of new energy vehicles will increase rapidly in the future, which will lead to the rapid growth of demand for high-end electrical steel, and the company will benefit from the high-profile demeanor of its strategic products.
Risk hint: the sales of new energy vehicles have fallen sharply and the prices of raw materials have risen sharply.