Fine chemicals aromatic ketones production enterprises. Based on Fu Ke reaction, the company produces all kinds of aromatic ketone products, including core raw materials of special engineering plastics, photoinitiators and cosmetic raw materials, pharmaceutical and pesticide intermediates, etc., with a current production capacity of 4200 tons. The downstream application fields are mainly aerospace, paint, ink, cosmetics and medical, food and beverage fields. From 2020 to 2022, the company's operating income was 2.88,3.42 and 398 million yuan, an increase of-1.33%, 18.80% and 16.39% over the same period last year, and the net profit deducted from non-return was 0.67,0.61 and 91 million yuan respectively, an increase of-5.60%,-9.43% and 50.84% respectively over the same period last year. The gross profit margin was 41.49%, 32.01% and 36.11% respectively, which could not be transmitted in time in 2021 due to the increase in raw material prices. Led to a decline in gross profit margin. 23Q1 realized operating income of 113 million yuan, an increase of 13.60% over the same period last year, deducting non-net profit of 22.6718 million yuan, a decrease of 2.56% over the same period last year. 23Q1 fund-raising project trial production, plant and equipment depreciation expenses increased, resulting in a lower gross profit margin compared with the same period last year.
The PEEK market is developing rapidly. In 2022, the company's income from special engineering plastics raw materials accounted for 50.95%. The DFBP produced by the company is mainly used as the monomer of special engineering plastics PEEK (polyether ether ketone). It is used in aerospace and automobile manufacturing, IT manufacturing, medical devices and industrial fields. According to the company's 2022 annual report, citing the forward-looking Industrial Research Institute, the global PEEK materials market grew from $560 million in 2013 to $831 million in 2018, with a compound growth rate of 8.21%. The company's customers include VICTREX (Wiggs), SOLVAY (Solvay), EVONIK (win Chuang), etc. The company's main competitors are Yingkou Xingfu (designed annual production capacity of 2000 tons) and Zhongxin fluorine materials (designed annual production capacity of 5000 tons).
New production capacity contributes to growth. In 2021, the company IPO raised 620 million yuan to invest in the construction of "annual output of 8000 tons of aromatic ketones and their supporting projects". Among them, 3400 tons / year of core raw materials of special engineering plastics (DFBP design capacity of 2500 tons / year), 500 tons / year of photoinitiator, 2950 tons / year of cosmetic raw materials, and 1150 tons / year of other products (pharmaceutical or pesticide intermediates). The construction period of the project is 3 years, and the date of reaching the scheduled state of use is 2023. After it is put into production, it will expand the production capacity of existing marketable products and produce products with great potential for development in order to open up new profit growth points.
Implement the equity incentive plan. In 2022, the company awarded 1.6 million restricted shares to directors, senior managers, middle managers and core technical (business) backbones. The assessment year is 2023-2025, for company-level performance (the revenue in 2023 is not less than 520 million yuan, the cumulative revenue in 2023-2024 is not less than 1.11 billion yuan, and the 24-year revenue growth is not less than 20%, the cumulative revenue in 2023-2025 is not less than 1.81 billion yuan, and the revenue growth in 2025 is not less than 20%).
Profit forecast. We estimate that the company's EPS for 23-25 years will be 0.95 pound 1.20 pound 1.51 yuan per share. Combined with the comparable company valuation, we give the company 27 times PE, corresponding to the target price of 25.65 yuan, and give the company a better than city rating for the first time.
Risk hint. The price of the product fluctuates; the production of the new project is not as expected.