Main points of investment:
The technology of resource utilization of waste sulfuric acid has been industrialized in major chemical fertilizer enterprises in China.
The company is a large producer of phosphate compound fertilizer, compound fertilizer and cement in Shandong Province, with an annual output of 150000 tons of ammonium phosphate, 600000 tons of cement and 1 million tons of compound fertilizer. Lubei Salt Chemical has an annual output of 1 million tons of raw salt (700000 tons) and 3000 tons of bromine (2200 tons), which occupies a middle position in the national sea salt production industry. In 2016, the income was 510 million yuan and the net profit was 30 million yuan.
The resource utilization technology of titanium dioxide waste acid and alkylated waste sulfuric acid in the company's petrochemical plant has formed the patent technology of independent intellectual property rights, and has achieved the success of industrialization, which not only improves the economic benefit of gypsum sulfuric acid co-production cement plant, but also realizes the resource utilization of waste sulfuric acid, and avoids the secondary pollution of waste acid. Reduce the treatment cost of waste acid Lubei Group, a major shareholder, introduced into Jinjiang Group, relying on the two major groups, and further reform of state-owned enterprises is expected.
On July 15, 2016, the company announced that it had completed the work of increasing capital and shares into Jinjiang Group. After completion, Lubei High-tech Zone holds 55.5% of the shares of Lubei Group, and Jinjiang Group holds 44.5% of Lubei Group. Lubei Group is still the major shareholder of the company, and Wudi County State-owned assets Administration is still the actual controller of the company.
In addition to Lubei Chemical, there are wholly owned subsidiaries Shandong Lubei Haisheng Biology Co., Ltd., Shandong Jinhai Titanium Resources Technology Co., Ltd., Shandong Wudi Lubei Chemical Construction and Security Co., Ltd., Wudi Haichuan installation Engineering Co., Ltd., Wudi Seaside Hotel Co., Ltd., joint venture companies include Datang Lubei Power Generation Co., Ltd., Shandong Hualan Chemical Co., Ltd.
It has an annual output of 1 million tons of alumina, 210000 tons of titanium dioxide, 1 million tons of compound fertilizer, 300000 tons of ammonium phosphate, 400000 tons of sulfuric acid, 600000 tons of cement, 1 million tons of raw salt, 10,000 tons of bromine, 200MW power generation, 600t/h heating scale. It is currently the largest joint manufacturer of ammonium phosphate, sulfuric acid and cement in the world, with an annual income of 10 billion yuan.
Hangzhou Jinjiang Group, founded in 1993, is a modern large-scale private enterprise group with environmental protection energy, non-ferrous metals, chemical industry and new materials as the main industry. in recent years, it distributes a large and healthy industry, and integrates trade and logistics, investment and finance. the total assets and revenue of the group both exceeded 50 billion.
Jinjiang Group participated in Lubei Group and implemented a series of state-owned enterprise reform measures to participate in operation.
1) on October 19, 2016, Shandong Lubei Enterprise Group Corporation entrusted Hangzhou Jinjiang Group to manage Shandong Lubei Haisheng Biology Co., Ltd and Wudi Zhongxin Aluminum Co., Ltd.; 2) on April 1, 2017, Hangzhou Jinjiang Group 350 million increased its stake in Shandong Jinhai Titanium Resources Technology Co., Ltd., a subsidiary of Shandong Lubei Enterprise Group Corporation, and joined the board of directors.
We expect that Jinjiang Group has already participated in part of the operation and management of Lubei Group, and the further reform of state-owned enterprises of Lubei Group and Lubei Chemical Industry is expected.
Set up an industrial fund aimed at new materials and new energy fields, including lithium battery materials.
In January 2017, the company announced that it had cooperated with Jinjiang Group, Hengjie Industry and Hangzhou Golden Investment to set up a new materials and new energy industry fund with a total fund of 1.001 billion yuan to invest in new materials and new energy industries. Including but not limited to lithium-ion battery materials projects, coal tar hydrogenation projects, electronic special gas projects. At the same time, when the projects invested by the fund meet the acquisition requirements and conditions of Lubei Chemical, Lubei Chemical enjoys the priority to acquire the investment projects.
According to Dazhong.com, Binzhou City people's Congress Deputy and Wudi County Party Committee Secretary said in an interview that Lubei Enterprise Group had reached a strategic cooperation with Hangzhou Jinjiang Group. the next step will be to build high-end projects such as battery-grade lithium carbonate, lithium iron phosphate and graphene, and strive to build a new material base for lithium batteries.
We expect that the cooperation between the company and Jinjiang Group on lithium materials will continue to advance.
Profit forecast and investment rating: the buy rating does not take into account the contribution of the company's new business development and state-owned enterprise reform. The company's EPS from 2017 to 2019 is expected to be 0.11,0.13,0.14 yuan respectively. We are optimistic that after the introduction of Lubei Group into Jinjiang Group, the cooperation between the company and Jinjiang Group in lithium materials covers the company for the first time and gives the company a buy rating.
Risk hint: the progress of the reform of state-owned enterprises is not as expected; the progress of the project is not as expected.