22H1's net profit increased by 25.77% compared with the same period last year, maintaining the "overweight" rating company 22H1's revenue of 3.677 billion yuan (yoy+18.72%) and net profit of 75 million yuan (yoy25.77%); 22Q2's net profit was 49 million yuan (yoy28.09%, qoq88.37%).
Considering that the company has increased the business layout of battery trays and lithium aluminum foil, and the expenses have declined during the period, we raise the company's profit forecast. It is estimated that the company's EPS in 22-24 will be 0.78x1.09x1.60 (the previous value is 0.74). The average PE (2022E) of the comparable company is 24.8X, taking into account the steady increase in copper plate, strip and foil production and the active layout of battery trays and lithium aluminum foil. Give the company a valuation of 27.3 times PE for 22 years, corresponding to the target price of 21.32 yuan (the previous value is 13.32 yuan), and maintain the "overweight" rating.
The company's copper strip products continue to expand production, Calendering copper foil 22H1 is still in the production capacity climbing stage. According to the company's semi-annual report and semi-annual main operating data, the company's red copper strip has formed a production capacity of 100000 tons in 21 years, and the production and sales of 22H1 has reached about 5.38 million tons (yoy + 4.26% 22H1 4.43%). The products are widely used in transformers, power cables, communication cables, radiators, heat exchangers, electronics and new energy. The company continues to carry out technical transformation and upgrading of the existing copper strip production line; at the same time, through its subsidiary Yongjie Copper Industry, it invests in a new production line with an annual output of 100000 tons of high-precision copper alloy strip and 50,000 tons of copper strip billet. The Calendering copper foil production line was put into production in 21 years, and is still in the production capacity climbing stage in the first half of 22 years. Calendering copper foil produces 1112.23 tons, which is mainly used in LED, printed circuit board, new energy soft connection, plate heat exchanger, back adhesive copper foil and so on. At present, the processing thickness of Calendering copper foil has reached 9 microns.
Copper plate strip and foil business is still the main business, the company's sales gross profit margin and period expense rate have declined according to the company's semi-annual report, 22H1 company's main business is still copper plate strip and foil business, battery tray business subsidiary loss of about 5.2398 million yuan. The company's gross profit margin on sales is 4.01% (yoy-0.48pct), and the corresponding net sales margin is 2.00% (yoy+0.06pct). The decline in gross profit margin is mainly due to the rise in copper prices.
In terms of expenses, the period expense rate was 1.51% (yoy-0.34pct), and sales expenses and management expenses increased by 31.49% and 36.72% year-on-year due to the increase in employee compensation. Financial expenses decreased by 48.61% year-on-year due to the increase in exchange earnings, and R & D expenses decreased by 13.07% due to reduced investment.
The company actively arranges new energy businesses such as battery trays, lithium battery aluminum foil and energy storage system integration, according to the company's semi-annual report, in the field of new energy, the company's related industrial layout includes new energy battery structure manufacturing, battery aluminum foil manufacturing and energy storage user design and operation. Zhongyuan New Energy, the company's holding subsidiary, began production in April 22, with an existing battery pack tray capacity of 100,000 pieces per year; in July 22, it is proposed to expand to 500000 pieces, and the main customers are Chery and Naga. Subsidiary Zhongyuan aluminum foil plans to invest in a new 50, 000-ton battery foil project, with an annual output of 25000 tons of battery foil as one of the company's 22-year non-public offering projects, and the project construction is being actively promoted. In addition, the company and related parties jointly invested in the establishment of Shenzhen Zhongyuan Xinneng Technology Co., Ltd., its main business is led by the energy storage system integration product scheme.
Risk hint: product demand and yield are lower than expected; the competition pattern of the industry is deteriorating.
