Continue to extend vertically to the industrial chain of dimethyl carbonate series products, forming an integrated production system dominated by dimethyl carbonate series products. As the first batch of domestic DMC production enterprises, the company built 5000 tons / year DMC equipment in 2003, and then kept pace with the market demand to expand the market scale, and the degree of recognition in the industry is also rising. With the deep ploughing in the electrolyte solvent market in recent years, it has become a domestic large-scale and internationally well-known lithium battery electrolyte solvent supplier, and the brand advantage is further demonstrated. The company has multiple technological routes such as epoxy propane transesterification and ethylene oxide transesterification in the production and planning of the new DMC project, as well as small-scale, pilot-scale and mass production platforms, with obvious advantages in technology research and development. After realizing the matching of the industrial chain, the competitiveness of the company's related products has been at a high level in the industry.

Multi-product portfolio one-stop supply services, competitive advantage is expected to be further enhanced. Electrolyte, as an important part of the lithium-ion battery industry chain, is generally composed of solvents, lithium salts and additives. The company also has five kinds of electrolyte solvents, lithium hexafluorophosphate, lithium difluoroxalate borate, fluorobenzene and other products, forming a comprehensive one-stop service supply platform to provide customers with solvents, lithium salts and additives. In the first half of 2022, the company announced successively 20,000 tons of positive lithium, 10,000 tons of fluorinated solvents, 10,000 tons of new conductive agents, 30,000 tons of silicon-based negative electrodes and other projects. In June, the company announced that it intends to invest 200,000 tons / year electrolyte projects in Wuhan and Meishan bases. the total planned production capacity of the electrolyte project will reach 700,000 tons / year, and the competitive advantage of the company will be further enhanced after the related projects are put into production smoothly.

Increase investment in scientific research to implement technological innovation, layout of silicon-based negative electrodes and other new lithium materials.

The company's 1000 tons / year silicon-based anode material production line was trial-produced in 2021. The breakthrough of silicon-based anode pre-lithiation technology provides support for large-scale industrial production, and the company's core competitiveness has been enhanced through unremitting technological transformation. The company's existing silicon-based anode products are high-efficiency silicon-oxygen-carbon anode materials, at the same time in the "gaseous silicon-carbon" has a certain technical reserve in research and development, gas-phase silicon-carbon can be used in solid-state batteries. The company has conducted certification tests with some power battery customers for more than a year, and the silicon-based negative electrode products have been certified by some customers, and the company will be able to ship in batches in 2023. Relying on Wenghua Research Institute, docking universities and scientific research institutions, the company will focus on the five major technological research and development directions of lithium electric materials, solvent processes, semiconductor auxiliary materials, electrolyte materials and silicon-based anode materials.

Profit forecast and investment rating. We predict that the return net profit of the company from 2022 to 2024 is 13.50,16.92,2.695 billion yuan respectively, and the corresponding EPS is 6.66,8.35,13.30 yuan per share respectively. If the company has new products put into production, it will be given a certain valuation premium. We will give it 13 times PE in 2023, corresponding to the target price of 108.55 yuan, and give it a "better than big city" rating for the first time.

Risk hints: the risk of new capacity in the market; the risk of lower-than-expected demand in the downstream market; the risk that the production schedule of capacity under construction is not as expected; the risk of a substantial increase in the cost of raw materials.