Zhongyi Technology is a well-known enterprise in the field of electrolytic copper foil in China, with rapid growth in performance. Zhongyi Science and Technology was founded in 2007, mainly engaged in all kinds of single-sided and double-sided optical high-performance electrolytic copper foil series product research and development, production and sales, long-term commitment to scientific and technological research and innovation. In 2016-2021, the company's revenue CAGR was 47%; the return net profit CAGR was 53%.
The high prosperity of power batteries continues, and the demand for lithium copper foil is expected to increase. We expect domestic and global power battery installations to be 249GWh and 521GWh respectively in 2022, an increase of 61% and 76% respectively over the same period last year. It is estimated that by 2025, the domestic and global power batteries will be installed in 642GWh and 1422G Whonomer 2021-2025, respectively, and the CAGR will be 43% and 48% respectively. According to the forward-looking Industrial Research Institute, in 2021, China's mainstream lithium battery manufacturers have adopted 6 μ m copper foil, accounting for more than 80% of annual lithium copper foil shipments. At the same time, some lithium copper foil enterprises ship a small amount of 4.5 μ m specification products, while overseas enterprises still give priority to 8 μ m specification products. It is estimated that the demand for 6 μ m lithium copper foil for power batteries in 2022-2025 is 15.0,24.1,39.9 and 597000 tons, and the CAGR for 2021-2025 is 60%; the demand for 4.5 μ m lithium copper foil is 2.4,5.9,13.1 and 211000 tons, and the CAGR for 2021-2025 is 157%; the total CAGR for lithium copper foil is 44%.
The company has certain product and technical advantages in the field of electrolytic copper foil. According to the company's prospectus, in terms of lithium copper foil, the company has achieved mass production of 6 μ m extremely thin lithium copper foil and has become one of the important copper foil suppliers in Ningde era. In addition, the company has mastered the research and development technology of 4.5 μ m lithium copper foil. In terms of standard copper foil, the company has a wide range of product specifications. It covers 12 μ m to 175 μ m and gradually extends to the field of high-end standard copper foil. According to the research data of Gao Gong Lithium Electric, the company ranks fourth in domestic lithium copper foil product shipments in 2020, and its market share in the standard copper foil field in 2019 is 2.45%.
Profit forecast and investment advice: the company's net profit from 2022 to 2024 is expected to be 4.8,7.4 and 990 million yuan respectively, an increase of 26%, 55% and 34% over the same period last year, corresponding to a PE valuation of 15,9 and 7 times respectively, covering the "overweight" rating for the first time.
Risk hint: sales of new energy vehicles fall short of expectations, industry competition intensifies, and product price cuts exceed expectations.
