Event: Yitong Xincai released its semi-annual report of 2022, with first-half revenue of 213 million, year-on-year-20.65%, return-home net profit of 52 million, year-on-year + 11.84%, deducting non-net profit of 41 million, year-on-year-6.62%.
Under the disturbance of the epidemic, the performance declined slightly, and the iron powder business is expected to pick up in the second half of the year. 1) the epidemic has led to a decline in the company's orders and performance, which is expected to improve in the second half of the year. The company's first-half revenue was 213 million, year-on-year-20.65%, deducting non-net profit of 41 million,-6.62% year-on-year. From a product point of view, the revenue of the company's high-performance pure iron powder / alloy steel powder / additive iron powder is-22.8% Mather 17.8% Maxime 17.1% respectively compared with the same period last year, mainly due to the impact of the epidemic in the first half of the year. Downstream automobile, home appliances and other industries demand is weak, customer orders decline. It is expected that as the epidemic recedes in the second half of the year, the company's iron-based powder product shipments are expected to pick up as a whole, which will lead to an improvement in performance. 2) with the reduction of scrap prices and large-scale cost reduction, the company's profitability is expected to continue to improve: the company's 22H1 gross profit margin / deduction non-net profit margin is 27.2% / 19.3% respectively, year-on-year + 3.6/+2.9pct, profitability has improved, with the decline of scrap prices of major raw materials in the future, and the company's capacity expansion leads to cost reduction and efficiency improvement (currently the company's iron-based powder production capacity is 80,000 tons, which is expected to expand to nearly 200000 tons in the future) Profitability is expected to continue to improve.
Soft magnetic + new energy parts business to create a new medium-and long-term performance growth point. 1) based on the technical accumulation in the field of metal powder, the company has entered the soft magnetic field: the company currently plans to produce 25000 tons of soft magnetic capacity (amorphous + nanocrystalline + iron-silicon / iron-nickel / iron-silicon-chromium powder, etc.). Including the 5000-ton project raised on the market and the 20,000-ton project to be built in June 2022, the products are mainly downstream for photovoltaic, energy storage, electric vehicles and other new energy fields, with broad demand prospects. At present, the plant and equipment of the 5000-ton project has been partially completed and is in the process of trial production and product sample certification; the construction period of the 20,000-ton project is expected to be 3 years, and the company estimates that the project is expected to achieve a net profit of 180 million after reaching production. 2) actively cut into the more prosperous clean energy parts track: in the first half of 2022, the company announced plans to build 20, 000 + 2000 new energy equipment key parts projects, including wind power spindle, pumped storage turbine spindle and other key components, the construction period is 2-3 years, with the continuous increase in the proportion of global renewable energy in the future, the clean energy parts market increases significantly, and the project is expected to achieve a total net profit of about 600 million yuan.
Profit forecast and investment advice: the company is expected to make a net profit of 1.2,1.7 and 290 million yuan in 2024, taking into account that the company is the leader of private enterprises in iron-based powder. and the soft magnetic + clean energy parts project is expected to provide new performance growth points, covering and giving "overweight" rating for the first time.
Risk hint: the lower-than-expected risk of downstream demand, the risk of policy change and the slow progress of project production.