Semi-annual report results exceeded expectations, photovoltaic industry layout is expected to increase the estimate to help growth, maintain the "buy" rating on July 28, the company released 2022 semi-annual report, achieving revenue of 7.479 billion yuan, an increase of 89.36%; return to the mother net profit of 2.635 billion yuan, an increase of 188.80%; corresponding to Q2 single-quarter revenue of 4.393 billion yuan, an increase of 92.22%, a month-on-month increase of 42.34% The net profit was 1.592 billion yuan, an increase of 139.02% over the same period last year and 52.67% month-on-month. The quarterly performance reached a new high. We maintain the profit forecast and estimate that the return net profit from 2022 to 2024 is 50.09,55.19 and 6.394 billion yuan, corresponding to EPS 0.57,0.62,0.72 yuan per share, and the current stock price corresponds to 6.8,6.2,5.4 times of PE from 2022 to 2024. The profitability of the company is leading in the industry, the double glyphosate project has completed the feasibility report and filing procedures, the layout of the photovoltaic industry helps to improve the valuation, there is broad room for future growth, and the "buy" rating is maintained.
The volume and price of the main products have risen, the cost of raw materials has risen, the company's performance has reached a record high, and its profitability has increased steadily. According to the company announcement, 2022H1, the average price of soda ash, ammonium chloride, diglyphosate and glyphosate was 2377.64, 1280.67, 34169.16 and 60064.00 yuan / ton respectively, up 57.41%, 92.26%, 119.39% and 99.06% over the same period last year. In terms of production and marketing, the external sales of the above products H1 reached 73.99,74.22,5.12 and 35600 tons, respectively, which were + 31.77%, + 1.00%,-46.49% and + 19.65% respectively over the same period last year. In terms of raw materials, the prices of natural gas, electricity, raw coal and yellow phosphorus increased by 21.51%, 2.27%, 12.22% and 84.89% respectively compared with the same period last year. The volume and price of the main products rose together, coupled with the company's excellent cost control ability to cushion the impact of the rise in raw material prices, achieving a substantial increase in revenue and performance compared with the same period last year, and a steady increase in profitability. 2022H1's sales gross profit margin reached 48.36%, net profit rate reached 35.31%, + 13.71pcts, + 12.03pcts respectively.
The trial production of N-type plus single crystal silicon wafer project is successful, the double glyphosate project is progressing smoothly, and the valuation is expected to be improved. According to the company announcement, Fuxing Technology N+ type ultra-high efficiency single crystal solar silicon wafer project start-up scale 1.5-2GW, Chongqing 8GW photovoltaic packaging materials and products project 1000t/d photovoltaic glass panel line and 1GW module packaging line, are now in the process of trial production and are scheduled to be put into production in the near future. The 500,000 t / a double glyphosate project has completed the project feasibility study report and filing procedures, proposed to increase the green environmental protection comprehensive recycling recovery equipment and upgrade the overall project safety level, and the total investment of the project has been adjusted from about 12.5 billion yuan to 16.7 billion yuan. We believe that with the orderly progress of a series of projects such as N-type silicon wafer, photovoltaic glass and double glyphosate, the company's valuation will be further improved and there will be broad room for growth in the future.
Risk tips: product prices fall sharply, project progress is not as expected, product verification is not as expected, and so on.