One of the leading mica insulation materials, the company's profit is stable and rising. The company was founded in 1991 and is a mica insulation material manufacturer integrating R&D, production and sales. It has formed a pattern of collaborative development of the three major product series: mica insulation materials, glass fiber cloth, and new energy insulation materials.
2020-2023H1 achieved operating income of 6.7/8.8/8.4 billion yuan, up 0.3%/31%/-4%/9% year on year, net profit to mother of 0.68/1.22/1.32/083 million yuan, respectively, up -33%/78%/8%/25% year on year, and achieved steady growth in performance. Mica insulation materials are the main business force. 2020-2023H1 accounts for 87%/77%/80%/77%, respectively. The share of new energy insulation materials in the main revenue increased rapidly, from 1.71% to 10.25%. The gross profit margin was 35%/32%/29%/34%, and the net profit margin was 13%/14%/16%/18%, and the trend was steady and upward.
The size of the mica market continues to expand, and new energy insulation materials have become a new driving force for growth. According to market statistics, the global mica market is expected to have a compound annual growth rate of 12.75% in 2023-2025, reaching 25.3 billion yuan in 2025, and the domestic market's compound growth rate of 27.84% in 2023-2025. The scale will increase to 11.224 billion yuan. The market size of refractory materials and insulation materials will be 3.6 billion yuan and 4 billion yuan respectively, totaling 7.6 billion yuan, accounting for 68%, as the main application areas. The domestic mica market concentration is low. In 2022, the company's market share of mica and new energy insulation materials was 13%, and the global market share was 5%. Among them, the market share of new energy insulation materials increased from 0.29% to 1.13% in 2020-2022, becoming the company's new growth driver. In November 2021, it obtained the Single Champion Demonstration Enterprise Certificate in the manufacturing industry, and is one of the leading enterprises in this field.
The layout of the entire industry chain stabilizes the market position of segmented industries. Build an artificially synthesized mica production line with a production capacity of 10,000 tons/year, significantly improving the integrity of the industrial chain, enhancing control over upstream raw materials, and forming a stable, efficient and sustainable mica raw material supply system. In line with the trend of continuous expansion in the application field of mica materials, we are vigorously laying out the field of new energy insulation materials, adding 4,068 tons/year of new energy security components to better meet the booming demand for downstream NEVs, energy storage, etc.
Continue to deeply cultivate the entire mica material industry chain and further expand glass fiber products, adding 10,600 tons/year of mica paper, 80,000 tons/year of mica board, and 125 million meters/year of industrial and ultra-thin electronic glass fiber cloth, stabilizing the company's leading position in the industry segment, and building industry-leading new material research and development capabilities and a brand advantage that wins with quality.
Profit forecast and investment rating: Considering that the company currently maintains a leading position in the field of mica insulation materials, downstream demand drives the company's performance to improve. We expect the company's 2024-2026 net profit to be 2.12/2.94/378 million yuan, a year-on-year growth rate of 29%/39%/29%. Based on the issue price, 2024-2026 PE was 15/11/9 times, respectively.
Risk warning: Price fluctuations of raw materials and risk of supply shortages, risk of alternative technology or products, risk of product exports.