Events:
The company announces its annual performance forecast for 2020. During the reporting period, the company realized net profit of 83.4684 million yuan to 90.921 million yuan, up 12% to 22% over the same period last year, and realized net profit of 76.7519 million yuan to 84.2045 million yuan, up 9.04% and 19.63% over the same period last year. The company Q4 realized a net profit of 23.016 million yuan to 30.4686 million yuan, an increase of 37.08% to 81.47% over the same period last year, and a net profit of 21.634 million yuan to 29.0866 million yuan, an increase of 46.39% and 96.82% over the same period last year.
Comments:
New production capacity has been put into operation, and production and sales of products have increased. The company's main production capacity has been released: the first phase of the annual production capacity of 40,000 tons of MBS (20,000 tons / year MBS) was completed and put into production in the middle of 2020; Linyi Ruifeng annual production capacity of 40,000 tons of MC phase I project (20,000 tons / year MC) reached production efficiency in the middle of 2020. The company's capacity utilization rate for the whole year also remained at a high level, producing about 120000 tons of various products during the reporting period, an increase of about 45% over the same period last year, and selling about 115000 tons of products, an increase of about 36% over the same period last year.
PVC auxiliaries industry leader, production capacity growth to help continue to improve performance. Benefiting from the growth of demand for plastic products, the reduction of raw material costs and the development of PVC flooring industry, the company's main products ACR, MBS market continues to grow. The company is a leader in the domestic PVC auxiliary industry, with a production capacity in the forefront of the country. As of January 4, 2001, the company has a production capacity of 140000 tons of PVC auxiliaries, in addition, there are plans to build 60, 000 tons of new PVC auxiliaries. The release of new capacity in the future is expected to promote the company's continued growth.
With the rapid development of degradable plastics, the company's PBAT project will become a new performance growth point. According to our estimation, after the implementation of the plastic restriction and ban policy issued by the National Development and Reform Commission and the Ministry of Ecological Environment in January 2020, the demand for biodegradable plastics in the three areas of takeout, express delivery and agricultural film will reach nearly 2 million tons in the future, of which the PBAT market will be about 1.5 million tons, with great room for growth in the future. Domestic PBAT capacity is expected to release about 200000 tons in 2021, and product prices are expected to remain high under supply constraints. The company laid out the PBAT industrial line ahead of time, and the PBAT project with an annual output of 60,000 tons is scheduled to be put into production in the autumn of 2021. In addition, the company has another 300000 tons of PBAT long-term planning, which has been put on record and has great room for growth in the future.
Investment advice: the company's 20-22 net profit is expected to be 0.88 trillion yuan, corresponding to the PE of 33, 18, 10 times, maintaining the "buy" rating.
Risk tips: the risk of large fluctuations in oil prices, the company's new production capacity is less than expected risk, degradable plastic policy landing is not as expected risk, and so on.