Overview of events
After consultation with the people's Government of Luocheng Mulao Autonomous County, the company reached an agreement on the investment and construction of "Luocheng Silicon New material R & D and Manufacturing Integration Project" in Luocheng County, Hechi City, Guangxi Province. and signed the "Zhongqi new materials Luocheng silicon crystal new materials R & D and manufacturing integration project investment contract". The investment contract bill passed by the board of directors on May 31 has yet to be examined and approved by the shareholders' general meeting.
Layout of high-end quartz sand upstream industrial chain, the gradual formation of artificial green stone and high-purity quartz silicon raw materials "two-wheel drive". This cooperation, the total investment of the project is about 1 billion yuan, and the total land of the project is about 338 mu, including 288 mu of industrial land and no less than 50 mu of land for production and construction in the mining area. The construction period of the project is 18 months, and the operating period is not less than 20 years. After the completion of the project, the annual output of high-end quartz silicon products is 1 million tons. The company's layout of high-purity quartz sand silicon raw material industry chain, two-wheel drive in the future is expected to form a comprehensive green stone industry service providers and high-purity silicon raw material suppliers, or is expected to reduce the cost of self-use quartz sand powder, an appropriate amount of export.
Complementary advantages to speed up the construction of the whole industrial chain layout of green stone. With the signing of a cooperation agreement with Luocheng County, the company can rely on the energy advantages of Luocheng Mulao Autonomous County, give full play to the company's R & D, production and manufacturing advantages in green quartz silicon crystal, realize complementary advantages and resource sharing, and speed up the development of main business. improve national and large-scale supply, layout of high-end quartz sand industry chain, optimize product structure, and gradually form the layout of the whole green stone industry chain.
Investment suggestion
As a manufacturer of artificial quartz stone, the company attaches importance to the optimization of product matrix, layout of high-end quartz placer, and extension of the industrial chain. 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 May 31, with a valuation of 21X/17X/14X, maintaining the "Buy" rating.
Risk hint
Raw material price fluctuation risk; market competition aggravates risk; real estate market fluctuation risk.