This report is read as follows:

The company is a leading enterprise of graphite electrode in China with obvious cost advantage. The company's static pressure graphite, nuclear graphite from research and development to the volume stage, the new third board, GDR release will promote the development of the company's special graphite, the company's performance growth may exceed expectations.

Main points of investment:

Maintain the "overweight" rating. The company is the leader of graphite electrode, and the development of special graphite is carried out rapidly.

We maintain the company's forecast of 0.28 EPS 0.41 to 0.46 yuan from 2022 to 2024. Maintain the company's target price of 8.4 yuan and maintain the "overweight" rating.

The company's performance growth rate may exceed market expectations. The market thinks that the graphite electrode has more new production capacity, the competition pattern of the industry becomes worse, and the profit of the electric furnace fluctuates near the loss line, the profitability of the graphite electrode industry is weak, and the company's future performance growth is weak. We believe that the graphite electrode industry has returned to the balance of supply and demand, and low-cost, high-end to build the company's profitability toughness, graphite electrode "two into one"

Superimposed special graphite force, the company's performance growth rate may exceed market expectations.

Graphite electrode business "two into one". At present, the company has a production capacity of 220000 tons of graphite electrodes, with a domestic and global market share of 15.3% and 9.7% respectively. The company is a leading enterprise in the field of graphite electrodes in the world.

The company's petroleum coke is completely self-sufficient, needle coke has a high self-sufficiency rate, and the cost has a strong competitive advantage.

We expect that with the commissioning of the relocation capacity of the company's Hefei and Chengdu bases, the company's graphite electrode production capacity will rise to 275000 tons in 2025, and the company will become the world's largest producer of graphite electrodes.

Special graphite and anode materials have entered a period of rapid development. Special graphite material is the company's continuous key layout area, through continuous R & D investment, the company static pressure graphite, nuclear graphite gradually entered the volume stage. With the listing of the subsidiary Chengdu carbon new board and the issuance of the company's GDR, with the help of the capital market, the company's special graphite and negative material business will enter a period of rapid development.

The downstream demand of special graphite and anode materials is growing rapidly, and the company's performance will enter a period of rapid growth.

Risk hint: new production capacity is not as expected, new third board and unpredictable risks of GDR issuance.