Overview of events
On April 26, the company released its 2021 annual report. In 2021, the company realized operating income of 725 million yuan, an increase of 30.59% over the same period last year, and a net profit of 141 million yuan, an increase of 3.44% over the same period last year.
The construction of the production line has progressed steadily, and the production capacity of Gaoming No.2 Plant has been gradually released. The progress of the first phase of Zhongqi (Hubei) new materials construction project reached 29.71%, with an estimated income of 104 million yuan after completion, while the second phase expansion project of Gaoming second plant reached 56.54%, with an estimated income of 23.745 million yuan after completion. The production capacity of Gaoming No.2 Plant has been gradually released, and the production capacity has increased as a whole. in 2021, plate production was 2.5365 million square meters, an increase of 34.73 percent over the same period last year, and table production was 590,000 meters, an increase of 29.26 percent over the same period last year.
The rise in the purchase price of the main raw material "resin" affects profits. 2021 the material cost of the company was 319 million yuan, an increase of 7.95% over the same period last year, accounting for 62.29% of the operating cost, accounting for an increase in 7.94pct compared with 2020. Of this total, the material cost of the plate business was 248 million yuan, an increase of 6.86% over the same period last year, and the material cost of the table business was 70.0805 million yuan, an increase of 1.04% over the same period last year.
Downstream binding custom home enterprises, the top five customers account for about 36% of sales. At present, the company's sales model is mainly direct sales, downstream customers are mainly customized household enterprises, artificial quartz stone brands, and so on. In 2021, the total sales of the company's top five customers were 258 million yuan, accounting for 35.65% of the total annual sales.
Investment suggestion
As a manufacturer of artificial quartz stone, the company attaches importance to optimizing product matrix, improving channel sales and improving the level of operation and management. We estimate that the company's operating income in 2022-2024 will be 8.86 billion yuan, an increase of 22.3%, 13.7% and 17.5% over the same period last year. The net profit returned to the home was RMB 1.60max, an increase of 13.3% / 22.3%, 18.9%, respectively, and the EPS was 2.57 yuan per share, corresponding to the share price on April 28, which was valued at 13X/10X/9X and maintained the "Buy" rating.
Risk hint
Raw material price fluctuation risk; market competition aggravates risk; real estate market fluctuation risk.