Event: the company announced the issuance of A-share convertible bonds with a plan to raise 300 million yuan for the construction of new aluminum projects with an annual output of 86000 tons of new energy battery fluid collector materials (Phase II).
Cut into the battery aluminum foil track, the company's capacity scale is expanded and the product structure is optimized, and the profitability is expected to be further improved in the future. 1) after the IPO fund-raising project and the convertible bond project were put into production, the production capacity of the company in 2024 was 6.4, 12.4 and 21.0 million tons respectively. The company's existing construction aluminum production capacity of 40,000 tons / year, food packaging aluminum production capacity of 24,000 tons / year. The future production capacity growth will mainly come from the IPO investment project and this convertible bond project: the ① IPO investment project is expected to be completed and put into production by the end of 2022. The company IPO raised 380 million yuan to build an aluminum finishing base, which is expected to be completed by the end of 2022, with additional construction aluminum production capacity of 20,000 tons / year, automotive aluminum production capacity of 20,000 tons / year, high-performance composite aluminum production capacity of 20,000 tons / year; ② convertible bond project capacity planning of 86000 tons. The company's convertible bond project will build 86000 tons of new energy battery fluid-collecting materials, which is expected to be completed and put into production in 2024. With the continuous commissioning of the IPO investment project and the convertible bond project, the company's total aluminum production capacity increased by 660,000 tons to 12420000 tons respectively in 2022max in 2024. 2) cut into the aluminum foil of the battery, the profitability is expected to improve.
The convertible bond project plans to build a capacity of 40,000 tons of battery foil (light foil) and 40,000 tons of aluminum strip, considering that the gross profit margin of battery aluminum foil is significantly higher than that of the company's existing products (Dingsheng new material and Nanshan aluminum battery aluminum foil gross profit margin of 29.64% and 22.27% respectively in 2021, much higher than the company's existing aluminum gross margin of 14.91%), the future product structure optimization, the company's profitability is expected to be further improved.
New energy vehicles + energy storage drive the scene upward, and the barriers to production expansion are high. It is difficult to solve the shortage of supply and demand of battery aluminum foil in the short term. 1) New energy vehicles + energy storage demand burst: production and sales of new energy vehicles continued to increase rapidly in 2022, and it is expected to maintain an average annual growth rate of more than 35% by 2025. In the aspect of energy storage, the economy of electrochemical energy storage continues to improve, and the policy is expected to achieve explosive growth. Demand-side rapid volume leads to a rapid rise in battery aluminum foil demand; 2) high barriers to production expansion, short-term supply and demand will remain tight: battery aluminum foil production line expansion cycle is long (construction period 2-3 years), high technical barriers (complex process and high requirements for product performance, so it is difficult to improve yield), so it is not easy to expand production on the supply side, the tight pattern of supply and demand in the industry is difficult to solve in the short term, and processing fees are expected to remain high in the next few years.
Profit forecast and investment suggestion: it is estimated that the net profit from 2022 to 2024 will be 1.36 billion yuan. Taking into account capacity expansion, product structure optimization, for the first time to cover the company's "overweight" rating.
Risk tips: downstream demand is lower than expected, product prices fluctuate, and projects under construction are not as expected.