Brief comment on performance
On October 30th, the company disclosed that the revenue in the first three quarters was 2.33 billion yuan, + 148% compared with the same period last year, and the net profit was 588 million yuan, + 281% compared with the same period last year. Q3 realized revenue of 871 million yuan, + 144% year-on-year and + 7% compared with the same period last year. The net profit of returning to the mother was 181 million yuan, + 189% and-23% respectively.
Business analysis
The cost of quartz sand is rising and profits are under pressure in stages. Since July, the price of silicon material in the upstream of photovoltaic has stabilized, the terminal wait-and-see demand has been gradually released, the growth rate of silicon wafer links has increased, the quartz crucible has maintained a high boom, and the tight supply of high-quality imported sand upstream has led to a price rise. According to third-party statistics, the high price of imported high-purity quartz sand has risen to about 400000 yuan / ton. As a result, the company's production costs increased, and Q3 sales gross profit margin decreased by 8.5 PCT to 28.82% month-on-month, resulting in performance pressure.
N-type volume increases the amount of crucibles, and the supply and demand of high-quality crucibles may continue to be tight. The crystal drawing time of N-type silicon rod is shorter and the crucible consumption is increased. With the release of N-type battery technology such as TOPCon, the crucible consumption will increase. However, the imported high-quality quartz sand ore resources of the core raw materials of the crucible are scarce, and the willingness of overseas enterprises to expand production is low. It is expected that the supply increment of imported quartz sand in 24-25 years is limited, and the supply of crucible / high purity quartz sand remains tight. Crucible price and profitability are expected to maintain a high level.
Capacity release + raw material locking + product advantages to ensure the continuous growth of crucible performance. The company actively expands the production capacity of crucibles, and the Ningxia Phase I / II project plans 8 / 10 production lines of crucibles respectively. After all the crucibles are put into production, the production capacity of crucibles will be increased to 340000 / year, which will further open the shipping space of crucibles. In addition, the company locks the imported sand supply of core raw materials and superimposes the leading crucible production technology, which is expected to fully transmit the increase in raw material cost by virtue of product advantages, and the crucible performance is expected to continue to grow.
Earnings forecast, valuation and rating
According to our latest forecast for the price of crucibles and quartz sand products, the company's net profit for 2023-2025 will be lowered to 7.7 (- 22%), 11 (- 13%) and 14 (- 15) billion yuan, respectively, and the current share price will be multiple of PE in 11-8-6, maintaining the "buy" rating.
Risk hint
The supply of raw materials is lower than expected, the price fluctuation is higher than expected, and the demand of the industry is lower than expected.