The non-profit in the first half of the year was 1.714 billion yuan, an increase of 209.53% over the same period last year. The operating income in the first half of the year was 10.116 billion yuan, which was + 56.20% compared with the same period last year. In the first half of the year, 30 projects were completed, including the expansion of PVDF products, which is an indispensable material for lithium battery, photovoltaic and other new energy in the industry, so the market demand for PVDF is also rising, and the company is an important supplier of domestic lithium battery grade PVDF.
The performance of fluorinated polymer materials in the first half of the year was 1.149 billion yuan, an increase of 178.38% over the same period last year. The reason for the rise is that since last year, the rise of the domestic lithium battery industry has led to a surge in demand for PVDF compared with the same period, and product prices have increased significantly compared with the same period. The market situation of this product continues the trend of the second half of last year, and there is an obvious phenomenon that supply falls short of demand, so the company has plans to expand production this year and in the future, with an overall plan to reach a total annual production capacity of 55000 tons of ╱ by 2025.
The organosilicon division achieved a performance of 637 million yuan in the first half, an increase of 52.42% over the same period last year. Some of the listed projects of Shandong Dongyue silicone material Co., Ltd. have been put into production, resulting in a significant increase in the production capacity of the division, so the external sales revenue and performance of the division have increased significantly.
The performance of the refrigerant division in the first half of the year was 354 million yuan, an increase of 198.65% over the same period last year. The good performance of R142b products is the main reason for the increase in the division's performance compared with the same period last year. R142b products can be used as raw materials for fluorinated polymer material PVDF products. Due to the increased demand for PVDF, the demand for R142b is strong, which makes its price rise sharply compared with the same period last year.
The results of dichloromethane, PVC and caustic soda in the first half of the year were 2.14 yuan, an increase of 2188.01% over the same period last year. The segment products belong to bulk chemical products, and their prices fluctuate according to market conditions. In the first half of the year, the market demand for the segment's products was strong, the product price increased significantly, and the profit level increased greatly compared with the same period last year.
The company's new 10, 000-ton ╱ annual PVDF project is expected to be completed and put into production in October. Combined with the technical transformation of the original production capacity, it is estimated that the annual production capacity of PVDF products will reach 25000 tons of ╱ by the end of the year; the company has accelerated the project declaration of the remaining 30, 000 tons of ╱ annual PVDF project in the total capacity planning of 55000 tons ╱. With the rapid expansion of PVDF production capacity in the market, the price of the product is expected to gradually fall back to the normal range.
Profit forecast and investment rating: we estimate that the return net profit of Dongyue Group in 22-24 years is 33.69,33.96 and 3.608 billion yuan respectively, and the corresponding EPS is 1.49,1.51 and 1.60 yuan respectively. Based on the valuation of comparable companies in the same industry and considering that the valuation of Hong Kong shares is lower than that of A shares, we give Dongyue Group a valuation of 7 times PE in 2023, with a corresponding target price of HK $12.01 at the exchange rate of HK $0.88, maintaining an "better than market" investment rating.
Risk tips: macro environmental risk; foreign exchange risk; market environment deterioration risk.