In the first three quarters of 2022, the company achieved revenue of 4.72 billion yuan, + 178% compared with the same period last year; net profit of 600 million yuan, + 151% year-on-year; and 514 million yuan of non-return net and run, + 137% of the same period last year. Among them, Q3 achieved revenue of 2.03 billion yuan in 2022, year-on-year + 220%, month-on-month + 94.1%; return-to-mother net profit 246 million yuan, year-on-year + 214%, month-on-month + 72.1%, deducting non-return net profit 238 million yuan, year-on-year + 210%, month-on-month + 271%, the performance is in line with market expectations. The company is the leading enterprise of precision parts of traditional automobile engine, actively transforming to the new energy track, the business of lithium iron phosphate differentially locates the middle and high-end electric passenger car market, adopts oxalic acid ferrous railway line, and the product compaction density is high. successfully entered the Ningde era, honeycomb energy and other customer supply chain, accelerated production capacity expansion; at the same time, the company's multi-faceted layout of upstream resources, especially lithium and phosphorus sources, has a clear trend of cost reduction in the future. In addition, the company is actively building an intelligent electronic control product matrix, and the incremental parts of new energy vehicles have entered the supply chain of Huawei, United Electronics, BYD, New Power and other automobile companies, with remarkable growth in the future.
The segment valuation method is used to maintain the company's target market value of 30 billion yuan, corresponding to the target price of 25 yuan per share, and maintain the "buy" rating.
Matters: the company released its third quarterly report for 2022 on October 27. In this regard, our comments are as follows:
Q3 deducts non-return net profit of 238 million yuan, + 210% year-on-year and + 271% month-on-month, in line with market expectations. Revenue in the first three quarters of 2022 was 4.72 billion yuan, + 178% compared with the same period last year; net profit from home was 600 million yuan, + 151% from the same period last year; and 514 million yuan was deducted from non-return net and run, which was + 137% from the same period last year. Among them, Q3 achieved revenue of 2.03 billion yuan in 2022, year-on-year + 220%, month-on-month + 94.1%; return-to-mother net profit 246 million yuan, year-on-year + 214%, month-on-month + 72.1%, deducting non-return net profit 238 million yuan, year-on-year + 210%, month-on-month + 271%, the performance is in line with market expectations.
The profit per ton of iron and lithium increased significantly, and the zero business of new energy increased significantly. From a business point of view, we expect the company's lithium iron phosphate business Q3 to achieve an income of about 1.25 billion yuan, a shipment of 12000 tons, a corresponding income of about 104,000 yuan per ton, an estimated profit of about 130 million yuan, and a corresponding net interest rate of 10.4%. We estimate that the profit per ton of iron and lithium products is about 11000 yuan, an increase of about 29% over Q2 (about 8400 yuan for Q2), and a significant improvement in profitability, which is expected to mainly benefit from the scale effect brought about by the release of the company's new capacity to improve the layout of the superimposed upstream raw materials. We expect the company's auto parts plate Q3 to achieve revenue of about 780 million yuan, an increase of about 60% over the previous month, of which the incremental revenue of new energy vehicles is expected to be about 400 million yuan, contributing to a larger increase.
The gross profit margin decreased slightly from the previous month, and the expense rate was well controlled during the period. In the first three quarters of 2022, the company's overall gross profit margin was 20.2%, year-on-year-8.45pcts. Among them, the gross profit margin of Q3 company in 2022 is 19.4%, same as-6.55pcts, month-on-1.16pcts, period expense rate is 6.20%, year-on-year-6.50pcts, month-on-3.21pcts. Where:
The sales expense rate is 1.18%, year-on-year-1.10pcts, month-on-month ratio-0.66pct; management expense rate is 2.77%, year-on-year-2.82pcts, month-on-month ratio-0.66pct; R & D expense rate is 1.94%, year-on-year-3.18pcts, month-on-month ratio-2.09pcts; financial expense rate is 0.32%, year-on-year + 0.60pct, month-on-month + 0.20pct.
The production capacity of iron and lithium is accelerated, and the new production line is compatible with the production requirements of lithium manganese. The company announced that the subsidiary Jiangxi sublimation plans to sign an "Investment contract" with the Management Committee of Yichun Economic Development District to invest in the construction of an integration project with an annual output of 200000 tons of new high-pressure solid lithium iron phosphate and supporting main materials, with a total investment of 5 billion yuan. the corresponding investment of 10,000 tons is about 25,000 yuan / ton. The project is divided into two phases. Jiangxi sublimation plans to start the first phase of the project with a capacity of 150000 tons in the existing plant area of Yichun base, which is expected to be completed and put into production by the end of 2023. With the commissioning of Sichuan Shehong Phase II project in September this year, the company currently has a nominal production capacity of about 152000 tons of lithium iron phosphate, and is expected to reach 300000 tons by the end of 2023, which will further meet customers' demand for high-end products and enhance the company's position in the industry. In addition, according to the company, after the completion of the project, there will be both lithium iron phosphate and lithium manganese iron phosphate process and production requirements to meet the diversified needs of customers and enhance the company's comprehensive competitiveness.
Join hands with Jiangte Motor layout new lithium salt, long-term cost reduction path is clear. The company also announced a series of cooperation projects with Jiangte Motor, including: 1) to participate in the Yifeng Lithium Salt Project of Jiangte Motor (10%), and jointly invest in the new 20,000 t / a Lithium Salt Project. The lithium carbonate produced is given priority to supply to the company according to 50% of the output (if the output permits, in principle, no less than 10,000 tons / year). 2) it is proposed to set up a joint venture with Jiangte Mining, a wholly owned subsidiary of Jiangte Motor, in Yifeng County, Yichun City, with an investment of 500 million yuan to build a new lithium salt project with an annual output of not less than 50,000 tons. The company's product differentiation positioning in the high-end electric passenger car market, using oxalic acid ferrous iron line to prepare lithium iron phosphate, the product has high compaction density, in which lithium dihydrogen phosphate is one of the company's main raw materials. This time, the company cooperates with Jiangte Motor to lay out a new type of lithium salt, which uses lithium sulfate to prepare lithium dihydrogen phosphate in the technical route, which is more simplified than the production process of lithium carbonate, which is expected to ensure the supply of raw materials while reducing production costs. further enhance the company's profitability.
Risk factors: cyclical fluctuations in the automotive industry; increased competition in the auto parts industry; raw material supply and price fluctuations; iterative risk of new energy battery technology; iterative risk of lithium iron phosphate technology; the company's new capacity construction progress of lithium iron phosphate is not as expected; the company's traditional auto parts business competition pressure intensifies; intelligent electronic control business product iteration may bring product update iterative risk to the company.
Investment suggestion: the annual net profit of the company in 2022-23-24 is 9.38 million yuan, respectively, and the corresponding EPS is 1.75 yuan per share, respectively. The current price of the company is 1.75 yuan per share in 2022-23-24, which is times higher than that in 19-11-9. The company is the leading enterprise of precision parts of traditional automobile engine, actively transforming to the new energy track, the business of lithium iron phosphate differentially locates the middle and high-end electric passenger car market, adopts oxalic acid ferrous railway line, and the product compaction density is high. successfully entered the Ningde era, honeycomb energy and other customer supply chain, accelerated production capacity expansion; at the same time, the company's multi-faceted layout of upstream resources, especially lithium and phosphorus sources, has a clear trend of cost reduction in the future.
In addition, the company is actively building an intelligent electronic control product matrix, and the incremental parts of new energy vehicles have entered the supply chain of Huawei, United Electronics, BYD, New Power and other automobile companies, with remarkable growth in the future. By using the segment valuation method, we estimate that the net profit of the company's lithium iron phosphate business in 2023 is about 1.12 billion yuan. With reference to the industry comparable company's valuation of German Nano and Dragon Technology (based on Wind's consensus expectation, the average PE in 2023 will be 17 times PE, corresponding to a market capitalization of 19 billion yuan). It is estimated that the net profit of the company's auto parts and intelligent electronic control business in 2023 is about 478 million yuan. With reference to the industry comparable company Baolong technology, Sanhua intelligent control, precision forging technology valuation (based on the consistent expectation of Wind, the average PE in 2023 is 23 times), the company is given 23 times PE, corresponding to a market capitalization of 11 billion yuan, with a total target market value of 190,11.0 billion yuan, corresponding to a target price of 25 yuan per share, maintaining a "buy" rating.
