[investment points]
On August 25, Jinyuan shares released a semi-annual report, with revenue of 2.804 billion yuan in the first half of the year,-39.25% year-on-year; net profit of 24 million yuan,-87.88%; and deduction of non-return net profit of-14 million yuan, year-on-year-110.54%. From a quarterly point of view, 2022Q2, the company achieved revenue of 1.806 billion yuan, year-on-year-41.14%, month-on-month + 80.96%; realized return-to-mother net profit of 39 million yuan, year-on-year-82.39%, month-on-month + 368.97%; realized non-return net profit of 32 million yuan, year-on-year-78.09%, month-on-month + 169.52%.
The volume of Baqiancuo Salt Lake is about to be released, and the layout of new energy materials will be accelerated. According to the company's semi-annual report, the company's Baqiancuo Salt Lake 10,000-ton lithium salt project has produced qualified refined lithium carbonate products in July 2022; at present, the short-term increment of upstream lithium resources is limited, and lithium resources are still in a tight state in the second half of the year. Lithium product prices are expected to maintain high operation before effective relief. During the reporting period, the company completed the construction of a lithium carbonate workshop with an annual output of 2000 tons. In the second phase of the project, the optimization design was carried out on the basis of the 2000 t / an expansion test device, and the 8000 t-10000 t / a production unit was built, and the production line was completed and reached the production standard by the end of November 2022. The construction period of the whole project is 13 months, and the annual output value is expected to be about 1.2 billion yuan after reaching production. The rapid increase in production capacity is expected to bring great profit growth for the company. In the second half of the year, the company will accelerate the construction of other domestic and overseas projects and the output of batch lithium carbonate products, and speed up the process of building a circular economy system of upstream lithium resource extraction and downstream waste lithium battery recycling.
At the same time, the company plans to acquire the remaining 49% stake in BABA Liyuan through share issuance and cash payment, laying the foundation for further expansion of lithium salt production capacity.
Overseas lithium resources projects have been launched to speed up the implementation of the new energy 515 plan. During the reporting period, the company organized a number of teams to discuss overseas lithium resources projects in various aspects to accelerate the process of overseas exploration and acquisition of lithium resources. Company subsidiary Zhejiang Jinhengwang Lithium Industry Co., Ltd. (shareholding ratio of three subsidiaries: Zhejiang Oupeng Technology Co., Ltd.; Zhejiang Jinyuan Zhongke Lithium Industry Co., Ltd. 95% Zhejiang Jinhengwang Lithium Industry Co., Ltd. (51%) through the establishment of the agency brilliant Lithium Industry to acquire the Laguna Caro mining rights project of Argentina Goldinka Energy company, the acquisition of Laguna Caro mining rights project will help to strengthen the strategic layout of the company's upstream lithium resources, better promote the future development, construction and production of the Argentine lithium salt lake project, and further enhance the company's core competitiveness and sustainable profitability.
The volume and price of environmental protection business have fallen, dragging down the overall performance of the company. According to the company announcement, the company achieved operating income of 2.804 billion yuan in the first half of the year,-39.26% of the same period last year, of which the environmental protection business realized operating income of 1.991 billion yuan, accounting for 71.0% of the total revenue, accounting for-39.56% of the total revenue. The poor performance of the environmental protection business is the main reason for the decline in the company's revenue in half a year. The company's hazardous (solid) waste harmless disposal business:
Affected by the epidemic, underemployment and fierce market competition have led to a decline in disposal prices and a reduction in the amount of disposal. According to the company's announcement, the operating income during the reporting period was 156 million yuan,-32.15% compared with the same period last year, and the net profit attributed to listed companies was 9.4276 million yuan,-77.02% of the same period last year. The company's comprehensive utilization of rare and precious metals business: realized operating income of 1.758 billion yuan,-42.63% compared with the same period last year. It is mainly due to the fact that the business model of comprehensive polymetallic recovery based on crude copper sales has changed to a business model based on polymetallic comprehensive recovery, and the volume of raw material procurement failed to keep up in time.
Divest the building materials business and optimize the business layout of the company. During the reporting period, the company's building materials business achieved operating income of 801 million yuan,-26.74% year-on-year, belonging to the net profit of listed companies-8.0663 million yuan,-107.51%. According to the company's announcement, during the reporting period, the overall performance of the building materials industry was poor, and its profitability declined significantly due to insufficient business, saturated demand, sharp rise in raw material prices, energy double control and other factors. During the reporting period, the company held a meeting and passed relevant proposals, achieving the strategic goal of divesting the building materials business and concentrating core funds to develop new energy materials business.
[investment advice]
During the reporting period, the company completed the construction of a workshop with an annual output of 2000 tons of lithium carbonate and the installation and commissioning of the first batch of electrochemical deintercalation devices, and successfully produced qualified lithium-rich liquid. Baqiancuo Salt Lake has produced qualified refined lithium carbonate products in July 2022. In addition, the acquisition of the Laguna Caro mining rights project will help to strengthen the company's strategic layout of upstream lithium resources, better promote the future development, construction and commissioning of the Argentine lithium salt lake project, better and faster implement the new energy 515 plan, and further enhance the company's core competitiveness and sustainable profitability. We estimate that the operating income of the company from 2022 to 2024 is 7.842 billion, 10.562 billion and 11.763 billion respectively, and the return net profit is 510 million yuan, 2.053 billion yuan and 2.117 billion yuan respectively, the corresponding EPS is 0.65 yuan, 2.42 yuan and 2.50 yuan respectively, and the corresponding PE is 24.38,6.57 and 6.37 times respectively. In view of the company's good future development prospects, clear growth and outstanding competitiveness, we give "overweight rating".
[risk Tip]
Price fluctuation of lithium salt
Production capacity and downstream demand are lower than expected