Event
The company released its results report for the first three quarters on October 28, 2022. In the first three quarters of 2022, the company realized a net profit of 238 million yuan, an increase of 22.53 percent over the same period last year, of which the net profit in the third quarter of 2022 was 80 million yuan, an increase of 26.17 percent over the same period last year. In recent years, under the background of the company's new production capacity continues to be put into operation, the company's operating income and profits are expected to continue to grow.
Brief comment
The sales volume of the main products continues to rise, driving the company's revenue to a new high.
According to the company's operating data in the third quarter, as the company's new production capacity continued to climb and put into production, the company's product sales and operating income maintained rapid growth. In 2022, Q3 achieved sales of 5450.01, 24101.09 and 1.0192384 billion square meters of cloth-based, paper-based and film-based tape, respectively, up 25.59%, 6.32% and 30.14% from the previous month. The operating income was 1.73,3.59 and 648 million yuan, an increase of 18.08%, 19.53% and 18.13% over the previous month. On the cost side, with the continuous decline in bulk prices, the company's main raw materials resin, OPP film, particles, butyl ester and other products have declined month-on-month. In the future, with the decline in raw material prices of the company's products, the company's business situation is expected to be further improved.
New BOPP film production line, bring new performance growth point for the company in the future new production capacity, mainly for the company's four newly expanded BOPP production lines, used for related tape production and OPP film production, according to the company's semi-annual report, of which 1-2 lines are put into production, 3-4 lines will be put into production in the second half of the year, as the company's new BOPP film production line continues to put into production will bring new performance increments for the company. According to the company's operating data, since 2022, as the company's OPP film production line has been put into production, OPP film sales and sales proportion has gradually increased, OPP film has become one of the company's main products, 2022 Q3 company OPP film sales of 15600 tons, a unit price of 9.03 yuan / kg, contributing 140 million yuan in operating income. In the future, with the production of BOPP film production line, OPP film is expected to bring continuous performance increment for the company and become a new performance growth point of the company.
The product range is rich and complete, and many kinds of business have the potential for development.
The company has a wide range of products. At present, the main products include cloth base tape, American pattern paper tape, PVC tape, OPP tape, double-sided tape, degradable environmental protection tape, automobile wire harness tape, medical tape and so on. Rich product lines enhance the company's comprehensive anti-risk ability, so that the company has the advantage of the whole industry chain. In addition, the company has professional product technical personnel who can customize products according to customers' individual needs and provide customers with perfect overall solutions. The company has the potential for multi-business development.
Profit forecast and valuation: the company is expected to achieve a net profit of 311 million yuan, 434 million yuan and 596 million yuan in 2022, 2023 and 2024, respectively, with a corresponding EPS of 1.63,2.27,3.12 yuan and a corresponding PE of 15.1x, 10.8x and 7.9x, respectively.
Risk tips: 1. The market demand is lower than expected: the downstream sales of the company's main business tape products are highly related to the macroeconomic level and national income level, considering that the macroeconomic cycle has certain fluctuations, the downstream market demand of the company's products may not be as good as expected. 2. External political uncertainty: in recent years, under the background of COVID-19 epidemic and the conflict between Russia and Ukraine, there are uncertain factors in the global political and economic pattern, which may have certain risks to the external sales of the company's products; 3. Downstream raw material price fluctuations: global commodities have been at a high level, and possible energy shortages in the future will aggravate raw material price fluctuations and may affect the company's profitability.
Sensitivity analysis: if the future global demand is lower than expected and the price of upstream raw materials fluctuates sharply, the company's profitability may be affected. through sensitivity analysis, it is estimated that the company's net profit in 2022, 2023 and 2024 is 287 million yuan, 373 million yuan and 489 million yuan, respectively.