Event
According to the 2021 annual report released on the evening of April 26, the company realized revenue of 62.753 billion yuan in 2021, an increase of 29.02% over the same period last year, realized net profit of 3.979 billion yuan, up 55.69% over the same period last year, deducted 4.048 billion yuan of non-return net profit, an increase of 56.58% over the same period last year, and realized EPS of 1.64 yuan.
Comment
The steel output is stable and the annual performance is in line with expectations. In 21 years, the company produced 11.4039 million tons of steel, an increase of 0.29 percent, 9.6603 million tons of pig iron, a decrease of 0.27 percent, 11.389 million tons of steel, a decrease of 1.23 percent, 446900 tons of coke, a decrease of 2.2 percent, 1240.6 tons of sinter, an increase of 3.59 percent, and pellets 184.75 tons, an increase of 19.54 percent. The company's comprehensive gross profit margin for 21 years is 12.3%, with an increase of 0.61pcts.
In 22 years, the company plans to produce 11.28 million tons of steel, 9.6 million tons of pig iron, 11.11 million tons of steel, 513000 tons of coke, 11.9 million tons of sinter and 2.09 million tons of pellets.
We will promote transformation and upgrading and focus on cost control. The company will speed up the approval and construction process of the capacity replacement and upgrading project, and promote the construction of Sanming headquarters 360m2 sintering machine, coke oven upgrade phase II, Xinqi blast furnace and other projects. Expand the production variety of No.2 steelmaking continuous caster in our department, and start the research and development of Luoyuan Minguang industrial materials and H-beam varieties. The company continues to strengthen the whole process cost reduction. In 21, Sanming headquarters, Quanzhou Minguang and Luoyuan Minguang realized cost reduction of 33.08yuan / ton, 34.47yuan / ton and 10.6yuan / ton respectively, with a total cost reduction of 338 million yuan.
Integrate the superior resources in the province, and the regional leader is gradually taking shape. 19 years ago, the company successively acquired 100% stake in San'an Iron and Steel through fixed increase acquisition and set up three wholly-owned subsidiaries such as Zhangzhou Minguang. In 20 years, the company acquired 100% stake in Luoyuan Minguang held by Sangang Group with its own funds. This acquisition will broaden its sales network, integrate regional customer resources, greatly exert synergy and enhance the company's long-term profitability. After the acquisition, the total production capacity of the company has increased to about 13 million tons, reducing transportation costs, increasing the province's market share to about 70%, and the regional leading position has been gradually formed.
Profit Forecast & Investment suggestion
According to the company's 22-year operating target, the 22-23 return net profit is reduced by 17% and 19% respectively. It is estimated that the 22-24 year return net profit is 3.29 billion yuan, 3.308 billion yuan and 3.316 billion yuan respectively, corresponding to EPS 1.34,1.35,1.35 yuan respectively, and the corresponding PE is 5 times, 5 times and 5 times respectively, maintaining the "overweight" rating.
Risk hint
The risk of strong cycle market operation in the iron and steel industry, and the risk of large fluctuations in raw materials and energy prices.