The company's performance achieved rapid growth in 2022. It is expected that driven by the strong demand downstream of maleic anhydride derivatives, the continuous optimization of product structure and the landing of new production capacity will inject impetus into the company's performance growth. We give the company a forecast of 1.76 EPS for 2023-2025 and 2.16 for 2.63 yuan. With reference to the valuation of PEG, we forecast the company's performance in 2023-2025 CAGR of 22.20%. According to PEG=1, we will give the company 22 times PE in 2023, corresponding to the target price of 39 yuan, and maintain the "buy" rating.
In 2022, the net profit of homecoming increased by 67.14% compared with the same period last year. In 2022, the company realized revenue of 1.597 billion yuan, year-on-year + 14.62%; net profit of 422 million yuan, + 67.14%; and non-return net profit of 406 million yuan, + 72.64% of the same period last year. In 2022, the company sold 67583.47 tons of maleic anhydride derivatives, of which the number of products used in the field of wind power was more than 6500 tons, accounting for about 10% of the total sales of maleic anhydride derivatives. The company's overall gross profit margin in 2022 was 36.00%, up 6.61pcts from 29.39% the previous year.
Among them, the gross profit margin of maleic anhydride derivatives was 38.15%, up 12.69 pcts over the previous year; and the gross profit margin of functional material intermediates was 35.38%, down 5.45pcts from the previous year. In 2022, Q4 achieved a revenue of 397 million yuan per quarter, compared with the same period last year, with a quarter-on-quarter revenue of-6.33% and a quarter-on-quarter revenue of + 4.27%, and a net profit of 101 million yuan per quarter, with a year-on-year net profit of + 33.36% and a quarter-on-quarter profit of-9.91%.
In 2022, the rate of four fees decreased by 2.86pcts, and the cash flow was good. In terms of expense rate, the company's annual sales rate in 2022 was 0.55%, an increase of 0.08pct over the previous year, mainly due to an increase in employee compensation and equity incentive fees; the management rate was 2.59%, up 0.02 pct from the previous year; the financial rate was-1.71%, down 01.88 pct from the previous year; the R & D rate was 4.64%, down 1.07 pcts from the previous year; and the four fee rates totaled 6.07%, down 2.86pcts from the previous year. In terms of cash flow, the net cash flow generated by operating activities in 2022 was 287 million yuan, and the net increase in cash and cash equivalents was 39 million yuan. The company continues to maintain a good cash flow of operating activities, and the rate of four expenses is well controlled. Looking forward to 2023, we expect to maintain a positive trend.
The demand for maleic anhydride derivatives is strong, and OLED intermediates are expected to benefit from the recovery of consumer electronics. In recent years, with the rapid development of downstream applications such as electronic and electrical materials, coatings and composite materials, the demand for maleic anhydride derivatives in the global market, especially in the domestic market, has been increasing. Under the background of carbon neutralization, the increasing investment in smart grid and UHV transmission lines in China benefits from the promotion of wind power, the wide application of new composite materials and the rapid development of electronic information industry. China's demand for maleic anhydride derivatives continues to grow. The proportion of OLED display in the field of small-size display has gradually increased in recent years, and the production scale of downstream OLED panels is also growing. Consumer electronics demand is relatively weak in 2022. We expect the demeanor to pick up in 2023, and the company's OLED materials business is expected to benefit.
Continue to expand production capacity and increase R & D investment to maintain a leading position in the industry. The company has strong technical advantages and cost advantages in the industry. In recent years, it has continuously developed and expanded its customer base, and has made rapid development. At the same time, the company continues to expand production capacity to break the growth bottleneck. In 2022, the company has completed the "annual production capacity of 20,000 tons of methyl tetrahydrophthalic anhydride expansion project", maleic anhydride derivatives production capacity of 71000 tons / year. The company orderly promotes the construction of "maleic anhydride derivatives, functional material intermediates and R & D center project", "functional material R & D and pilot-scale integration project". On the basis of consolidating existing products, the company increases investment in scientific research and maintains a leading position in the industry by developing new products with stronger profitability.
Risk factors: raw material price fluctuation; product price fluctuation; market competition intensifies; capacity construction progress is not as expected.
Earnings forecast, valuation and rating: the company's performance achieved rapid growth in 2022. It is expected that driven by the strong demand downstream of maleic anhydride derivatives, the continuous optimization of product structure and the landing of new production capacity will inject impetus into the company's performance growth. We maintain the company's EPS forecast of 1.76 yuan for 2023-2024 and 2.63 yuan for 2025 EPS. With reference to the valuation of PEG, we forecast the company's performance in 2023-2025 CAGR of 22.20%. According to PEG=1, we will give the company 22 times PE in 2023, corresponding to the target price of 39 yuan, and maintain the "buy" rating.