The current situation of the company
The company issued an announcement, change the amount of investment in some of the projects raised, increase the amount of investment in some projects by using over-raised funds, and adjust the implementation progress of the projects: 1) it is proposed to adjust the amount of funds raised by the use of "environmental protection new materials and intermediates" from 428 million yuan to 850 million yuan, the source of funds is over-raised funds. 2) the scheduled availability date of "Environmental Protection New material Intermediate Project" will be adjusted from June 2023 to February 2024; 3) the scheduled availability date of "Special Molecular sieve, Environmental Protection Catalyst and Automobile exhaust purification Catalyst industrialization Project" will be adjusted from February 2023 to December 2023.
Comment
Planning products such as m-cresol, TRH special molecular sieve, iron-molybdenum catalyst, etc., to promote the company's long-term growth.
Specifically, 1) m-cresol: the separation of m-cresol and p-cresol in the production process is a process difficulty, and the company expects that its independent research and development of adsorption and desorption process is expected to greatly reduce the separation cost. we think that it may bring strong cost competitiveness to the intermediate cresol products. 2) TRH molecular sieve: as a new generation of titanium-silicon molecular sieve, the company expects to replace titanium-silicon molecular sieve products as the main catalyst for epoxidation by virtue of its quality and cost advantages; 3) metal catalyst: it is an important catalyst in fine chemical industry, and we expect that there will be opportunities for localization to replace imported products. On the whole, we believe that the company's proposed new products have high technical content and broad market space, which is expected to drive the company's long-term growth.
The uncertain factors brought by the epidemic may be gradually eliminated, and we are optimistic about the recovery of the heavy truck industry chain. Affected by the regular management of COVID-19 's epidemic situation in 2022, the progress of the company's Heze factory construction project was greatly affected, and the company expected to reach production later. We believe that with the optimization of prevention and control measures in 2023, the uncertainty caused by the epidemic may be eliminated. At the same time, we are optimistic that the recovery of heavy truck demand brought about by the recovery of domestic logistics and other industries in 2023, the company's mobile source denitrification molecular sieve products as one of the key raw materials in the upper reaches of the heavy truck industry chain, domestic sales may resume rapid growth.
Profit forecast and valuation
We keep the profit forecast for 2022max 23 unchanged and introduce a profit forecast of 337 million yuan for 2024. The company's current share price corresponds to a 24-year price-to-earnings ratio of 23.1 pound 19.8x. Taking into account the company's layout of new products such as m-cresol and the gradual recovery of the heavy truck industry chain, we raise the company's target price by 12.5% to 45 yuan, corresponding to the 24-year price-to-earnings ratio of 26max 22x in 2023, and the current stock price corresponds to 18.8% of the rising space. Maintain the "outperform industry" rating.
Risk
The production progress of the new product was not as expected, the price of m-cresol fell sharply, and the demand for heavy trucks was lower than expected.
