With the expansion of production capacity and the expansion of the price gap of refined aluminum, the company is mainly engaged in the recovery of waste aluminum resources and the production and sales of recycled aluminum alloy, and is a leading enterprise in the field of recycling of aluminum resources. The company has two recycled aluminum production bases located in Taicang, Suzhou (with a production capacity of 370000 tons) and Malaysia (with a production capacity of 270000 tons). Benefiting from the implementation of China's policy of banning the import of solid waste, the profit of the overseas refined waste price gap has expanded significantly in Malaysia. The company is expanding its recycled aluminum production capacity and is building 1.3 million tons of recycled aluminum production capacity in Malaysia. It is expected that the first phase of 650000 tons will be put into production in 2023. It is expected that the future capacity expansion will lead to the continued growth of the company's profits.
Low-carbon recycled aluminum supply gap, recycled aluminum industry continues to be high-boom electrolytic aluminum under the dual pressure of China's supply-side reform and global carbon neutralization, the room for capacity expansion is limited, and the capital expenditure of traditional aluminum giants is slow. the shortage of raw aluminum supply may continue; demand-end photovoltaic, new energy vehicles are expected to become a new growth point of aluminum consumption, and it is expected that there will be a gap between supply and demand of electrolytic aluminum in the future.
The carbon emission per ton of electrolytic aluminum smelting is 11.2 tons, while that of recycled aluminum is only 0.23 tons. Carbon neutralization will promote the rapid development of recycled aluminum industry. In the future, the supply of recycled aluminum is expected to become an important way to make up for the gap between supply and demand of primary aluminum. In the future, the company will continue to benefit from the high prosperity of the recycled aluminum industry and the related capacity of green and low-carbon attributes.
Overseas refined waste price spread widens, homeopathic expansion of Malay capacity
The company has an existing aluminum alloy ingot production capacity of 640000 tons (operating capacity of 340000 tons) and a production capacity of 1.3 million tons under construction. at the same time, it continues to improve the resource recovery industry chain and layout recycling and disassembly plants in the United States; after 2017, China has gradually banned the import of solid waste. the accumulation of waste aluminum overseas has led to a decline in the price of waste aluminum in the United States and other places, and the price gap between overseas refined waste has greatly expanded. The company seizes the opportunity to actively improve the global procurement network, and the decline in raw material costs drives the company's gross profit of recycled aluminum tons to 2955 yuan from 1292 yuan in 2018 to 2955 yuan in 2021. It is expected that with the continuous release of recycled aluminum production capacity and the expansion of the price difference between refined and waste aluminum, the profit of the company has increased steadily with the rise of aluminum alloy ingots.
Investment suggestion
It is estimated that the return net profit of the company from 2022 to 2024 is 920 million yuan, 1.66 billion yuan and 2.47 billion yuan respectively, and the corresponding share price PE is 8.1,4.5 and 3.0 times respectively.
