Main points of investment

Investment advice: cover for the first time and give an "overweight" rating. The company focuses on the combined alkali process, the products of soda ash and ammonium chloride are expected to maintain a high boom, and the company's performance is expected to maintain growth. It is estimated that the EPS of the company from 2022 to 2024 will be 2.11, 2.17, 2.24 yuan. According to the comprehensive PE,PB valuation method, the company will be given a target price of 17.11 yuan and a "overweight" rating for the first time.

The company focuses on the production of soda ash and ammonium chloride by combined alkali process. In 2021, the company implemented asset restructuring and sold its real estate subsidiary and completely withdrew from the field of real estate development, thus focusing on the chemical business.

The company's existing soda production capacity of 1.1 million tons / year, co-production of ammonium chloride 1.1 million tons. The company has its own vacuum salt plant with a capacity of 1.2 million tons per year, which is used to produce salt needed in the combined alkali process. The company pays close attention to the construction of the upgrading and transformation project of synthetic ammonia, and implements the technical transformation of soda ash production plant and salt production plant according to its capacity to reduce the cost.

Soda ash and ammonium chloride are expected to maintain a high boom. At present, the operating rate of soda ash has been repaired to around 85%, and the price has rebounded to around 2800 yuan / ton. Photovoltaic glass capacity expansion restrictions open, many enterprises have announced production expansion, according to our statistics, the country is expected to increase photovoltaic glass production capacity in 2022 37800t 23080t/d is expected to be added in 2023. In the case of inelastic supply, soda ash prices are still expected to remain high or rebound, the company is expected to benefit. Ammonium chloride benefits from the high prosperity of compound fertilizer downstream and is expected to maintain a high price. According to our calculation, the price of soda ash and ammonium chloride has increased by 100 yuan per ton, and the company's profit has increased by 83 million.

Catalyst: photovoltaic glass production expansion progress accelerated, real estate demand warmed up.

Risk hint: the production of the project under construction is not as expected, and the downstream demand is not as expected.