Event
Hongxing Development released its semi-annual report for 2022: the company's operating income during the reporting period was 1.205 billion yuan, an increase of 32.33% over the same period last year; the net profit belonging to shareholders of listed companies was 194 million yuan, an increase of 185.81% over the same period last year; the net profit belonging to shareholders of listed companies after deducting non-recurring profits and losses was 192 million yuan, an increase of 199.77% over the same period last year; and basic income per share was 0.67 yuan.
Main points of investment
The company focuses on "barium salt, strontium salt and manganese series" to build core competitiveness the company's main business is barium salt, strontium salt and manganese series product research and development, production and sales. Among the main products, barium carbonate is mainly used in the production of ceramics and ceramic glazes, functional glass, magnetic materials, electronic components and other barium salt products; barium sulfate is mainly used in paints, coatings, plastics, batteries, smelting and other fields. Strontium salt products are mainly used in magnetic materials, liquid crystal glass substrate, metal smelting, fireworks and other strontium salts deep processing. Electrolytic manganese dioxide products are mainly used as cathode materials for primary batteries and lithium-ion secondary batteries, while high-purity manganese sulfate is mainly used for ternary cathode materials (precursors) for lithium ion batteries. The company's main product capacity: barium carbonate production capacity of 290000 tons (domestic leader), barium sulfate production capacity of 55000 tons, high-purity barium carbonate production capacity of 5000 tons, strontium carbonate production capacity of 30,000 tons, electrolytic manganese dioxide production capacity of 30,000 tons, high-purity manganese sulfate production capacity of 30,000 tons.
The main products continued to be booming, and profits increased greatly compared with the same period last year.
The first half of 2022 continues the support of product prices in the downstream market in 2021 as a whole, the main products barium carbonate, high-purity barium carbonate, strontium carbonate, electrolytic manganese oxide, high-purity manganese sulfate, sulfur, thiourea, battery-grade lithium carbonate and other products increased year-on-year, increasing the company's sales revenue and profits. The company gives full play to its comprehensive advantages and increases its product sales and market development. the increase in sales of some products of high-purity barium carbonate, strontium carbonate and high-purity strontium carbonate leads to an increase in sales income and profits of the company and its subsidiaries. ▌ takes advantage of the development of new energy, manganese series products can be expected to be high-purity manganese sulfate products are mainly used in lithium battery ternary cathode (precursor) materials. In recent years, the rapid development of the ternary battery industry has led to the exuberant demand of the ternary precursor industry, which indirectly led to the tight demand of high-purity manganese sulfate products throughout the year, and the price showed a rising trend. Since the second quarter of 2022, due to the influence of downstream demand, the relationship between supply and demand of high-purity manganese sulfate has changed, and the price has been adjusted back but remains high. In the first half of 2022, the company produced 11400 tons of high-purity manganese sulfate, an increase of 1400 tons over the same period last year, with sales of 6000 tons, a decrease of 3900 tons over the same period last year. The high purity manganese sulfate products of subsidiary Dalong Manganese Industry have unique competitive advantages in product quality and stability, and have established long-term and stable cooperative relations with some mainstream customers of downstream ternary precursors. Taking advantage of the development of new energy, the market prospect of ternary cathode materials is broad, and the pattern of supply and demand is expected to be improved.
Profit forecast
It is predicted that the income of the company from 2022 to 2024 is 24.11,25.5 and 2.68 billion yuan respectively, and the EPS is 1.2,1.42,1.62 yuan respectively, and the current stock price corresponding to PE is 21.4,18.2,15.9 times respectively.
Risk hint
Risks such as a sharp decline in economic prosperity, lower-than-expected production of new projects, large fluctuations in raw material prices, and lower-than-expected performance of the company.