The company made a profit of 83.21 million yuan in the third quarter of 2022, an increase of-10.04% over the same period last year. In the first three quarters of 2022, the company achieved revenue of 2.101 billion (year-on-year + 37.97%), net profit of 306 million (year-on-year + 7.86%), gross profit of 21.27%, net profit of 14.56%, corresponding to 2022Q3 revenue of 694 million (year-on-year + 23.11%, month-on-month-2.05%), net profit of 83 million (year-on-year-10.04%, month-on-month-28.68%), Q3 gross profit of 16.1%, net profit of 12%.
The company is mainly engaged in lithium copper foil and standard copper foil business. Lithium copper foil is mainly used in power batteries for new energy vehicles, lithium batteries for 3C electronic products, emergency power supplies, energy storage batteries and so on. Standard copper foil is one of the important basic materials of copper clad laminate and printed circuit board, which is widely used in the fields of communication, optoelectronics, consumer electronics, automobile and aerospace.
The decline in copper prices and processing fees put short-term pressure on results. The company's pricing model mainly adopts "copper price + processing fee". In terms of copper price, Changjia non-ferrous copper price Q3 price center is about 5.8-59,000 yuan / ton, compared with Q2 price center 70,000 yuan / ton, per ton month-on-month decline of more than 10,000 yuan. Therefore, it affects the revenue scale of the company. In terms of processing fees, we estimate that Q3 lithium copper foil processing fee is about 275,000 yuan / ton, compared with Q2 month-on-month decline of 0.2-30,000 yuan / ton; standard copper foil processing fee is about 17,000 yuan / ton, which is 0.6 thousand yuan / ton lower than Q2 month-on-month.
The company's shipments and production capacity are advancing steadily. According to Zhongyi science and technology capacity planning, it will be 19500 tons by the end of 2020 and reach 24500 tons by the end of 2021. With the company's production capacity put into production, it is expected that the company's production capacity will reach 42500 tons by the end of 2022. Yunmeng 13000 tons of production capacity and Yancheng 24000 tons of production capacity will be put into production in 2023, and the company's production capacity is expected to reach 79500 tons by the end of 2023. In terms of shipments, we estimate that Q3 copper foil shipments total 8300 tons, of which lithium copper foil is about 5800 tons and standard copper foil is 2500 tons. We expect the company to ship 33000 tons in 2022 and 53000 tons in 2023.
Risk hints: downstream demand is lower than expected; production progress is not as expected; raw material prices are rising faster than expected.
Investment advice: cover for the first time and give an "overweight" rating. The company's lithium copper foil and standard copper foil business capacity has been released rapidly, and the company is currently opening up a new business of composite copper foil. We expect to bring considerable performance growth for the company. We expect that the net profit from 2022 to 2024 will be 4.01pm 5.27 / 636 million yuan respectively, the year-on-year growth rate is 5.1pm 31.4 pm 20.8%, and the diluted EPS is 3.97pm 5.226.3 yuan respectively. The current share price corresponds to 11.1 times the PE of 17.6 shock 13.4 pounds, covering it for the first time and giving it an "overweight" rating.