Main points of investment
The third quarterly report of 2022: the performance increased by 116%, and the order / profit / valuation inflection point is expected to be realized one after another. 1) in the first three quarters of 2022, operating income reached 1.85 billion yuan, an increase of 184% over the same period last year, and net profit returned to the mother was 100 million yuan, an increase of 116% over the same period last year. Q3 single quarter: realized operating income of 900 million yuan, an increase of 196% over the same period last year, and net profit of 40 million yuan, an increase of 266% over the same period last year. 2) profitability: in the first three quarters of 2022, the gross profit margin and net profit margin were 13.2% and 6.0% respectively. Q3 single-quarter gross profit margin and net profit margin were 9.8% and 5.3% respectively. 3) expense side: the company's expenses are well controlled. In the first three quarters of 2022, the sales / management / financial expense rates were 1.0%, 3.8%, 1.3%, respectively, down 1.3 pct from the same period last year.
Lithium power materials equipment + production line contractors, lithium power revenue accounted for 88%, lithium power orders increased by 33% year-on-year, the company's layout of new energy business in 2017, to provide lithium materials enterprises with intelligent factory solutions and lithium battery proprietary equipment manufacturing. At present, it is the only listed company for the whole line supply of lithium materials. In the first half of 2022, newly signed contracts totaled 2.14 billion yuan, of which lithium plate contracts totaled 1.99 billion yuan (accounting for 93%, up 33% from the same period last year).
The investment in the three main materials production lines of lithium electricity will reach 52% in the next three years, and the domestic single-point equipment merchants, chemical industry, industry alliance and materials go to sea to promote the expansion of lithium materials. According to our in-depth report, the investment in the production line of lithium cathode, negative electrode and electrolyte in China is 56.1 billion yuan in 2022, which is expected to reach 198.9 billion yuan in 2025, and CAGR in three years is about 52%. Lithium materials market is mostly single-point equipment manufacturers, companies with the ability to deliver the whole line of manufacturers are very competitive.
Epitaxial mergers and acquisitions promote the self-supply rate of equipment to more than 80%, and strengthen the competition barrier of the whole line supply. at present, the company's self-supply rate of lithium materials and equipment has been raised to 80% from 40% in 2021, and there is room for further improvement. In 2022, the company successively acquired 60% stake in Wuxi Baistone and 40% equity in Suzhou Yunqi Valley to realize the self-supply of negative material kiln outer circulation line and lithium material sintering equipment. The company is actively promoting the acquisition of 60% equity in Suzhou. It is expected to further introduce ceramic roller technology (mainly used in positive material crushing equipment). The improvement of the self-supply rate of the company's equipment will help to strengthen the competitive barriers to the whole line supply of lithium materials and enhance profitability.
Strong endogenous R & D strength, high-quality and stable customer resources, to maintain a leading position in the field of lithium materials and equipment, wholly-owned subsidiary Baili Lithium (formerly Nanda Zijin) has rich experience in equipment and whole-line service in lithium positive / negative / precursor production lines. More than 500 production lines have been built all over the country. With its leading engineering design capability and service concept, the company has been widely recognized by high-quality customers such as Dangsheng Technology, Beitri, Anhui Haichuang, Guoxuan Hi-Tech, New Lithium, BASF Shanshan, Chengdu Bamo, Ningde Times and so on. And continue to open up new customers.
Profit forecast and valuation
It is estimated that the revenue from 2022 to 2024 will be RMB 2.93 billion, an increase of 182%, 63% and 30% respectively over the same period last year. The net profit from home will be RMB 2.2 million, an increase of 658%, an increase of 62%, and a year-on-year increase of 658%, and the corresponding PE will be 2716x11x, maintaining the "Buy" rating.
Risk suggests major shareholder pledge risk; lithium battery market is not as good as expected; acquisition integration is not as expected