occurrences
On June 13, the company disclosed its response to the Shanghai Stock Exchange's inquiry letter regarding fixed increase. The company has now broken through key technologies such as continuous polymerization process technology for cycloolefin copolymers and purification technology for cycloolefin copolymers, and has completed the cycloolefin monomer production line and small and pilot tests of cycloolefin polymers. Cycloolefin monomers already have industrialization capabilities, polymers have an industrialization foundation. The products have been tested by customers. Key indicators such as light transmittance, refractive index and stabilized glass temperature have reached the level of imported products. The company's R&D scale and production scale have reached the level of imported products. Move forward step by step.
The industrialization of COC is accelerating. After years of R&D, Arcolis has a first-mover advantage, and industrialized installations are progressing smoothly
COC (cycloolefin polymer) has excellent optical properties such as high transparency, low water absorption, and biocompatibility. Currently, it is mainly used in optical lens materials and pharmaceutical packaging materials. No industrial installations have been implemented in the country yet. In the past two years, the domestic industrialization process of COC/COP has accelerated. On the one hand, some domestic enterprises have achieved certain industrialization breakthroughs after years of R&D and accumulation; on the other hand, in the field of optics, downstream industrial chains such as consumer electronics and new energy vehicles have clearly moved to the country. The problem of this material has become increasingly prominent in Japan, and concerns about supply chain security have strengthened the desire of downstream manufacturers to replace domestic production, thus accelerating the upstream and downstream industrialization development process. Currently, the material is still showing excessive prices in many fields, positioning the product in high-end applications. We believe that the main bottleneck in the market is still on the supply side.
Judging from the response letter, Arcolis's 1,000-ton pilot project progressed smoothly, and all indicators have reached the level of imported products, and it is expected that it will be put into operation by the end of 2023. At the same time, in terms of customer development, the company has made business connections with downstream customers or potential customers, and has received positive responses from customers. The company has reached intended cooperation with many well-known downstream enterprises, covering the fields of optics and medicine. The company has been exploring R&D for too long, and its progress is at the forefront of the industrial chain.
Investment advice
We expect Arcoli's net profit for 2023-2025 to be 0.57, 120, 178 million yuan, EPS of 0.65/1.36/2.03 yuan, and the corresponding PE is 78.83X/37.39X/25.08X. Considering the expectations of a high growth rate in the company's future performance, the first coverage gave an “increase in holdings” rating.
Risk warning
The production capacity of the Hubei Qianjiang project fell short of expectations;
Competition in the polyetheramine and highly translucent materials industry is intensifying;
The promotion of highly translucent materials fell short of expectations;
The installation of wind power fell short of expectations.