Event: recently, the company issued a forecast for the performance of KuaiBao in 2020 and Q1 in 2021: in 2020, the company realized operating income of 24.686 billion yuan, down 17.87% from the same period last year; and realized net profit of 1.033 billion yuan belonging to shareholders of listed companies, an increase of 66.49% over the same period last year. Q1 realized net profit of 594 million yuan to 683 million yuan in 2021, a big increase of 200% over the same period last year.
Comments:
Riding on the east wind of the cycle, the company grabs the opportunity for the landing of new projects. The company's Q1 performance greatly exceeded expectations, on the one hand, because the prices of the company's main products methyl ethyl ketone and maleic anhydride began to rise from the second half of last year. The average price of methyl ethyl ketone rose from 6601 yuan / ton in 2020 to 8131 yuan / ton in 2021. The price of maleic anhydride rose from 5601 yuan / ton to 9821 yuan / ton, an increase of 75%. At the same time, the company accelerated the landing of new projects in Dongfeng during the cycle, including 200000 tons of nitrile latex and 200000 tons of MMA products were put into production in the fourth quarter and the first quarter of 2021 respectively. In the face of the impact of the epidemic, although the company's revenue declined, it ensured the maximization of product profits by keeping products fast in and out, increasing turnover, seizing product price increases, regulating sales in both domestic and foreign markets, and improving overall operational efficiency.
Deep ploughing C4 industrial chain, actively extend the product line. The company has the world's largest production capacity of 180000 tons of methyl ethyl ketone and 200000 tons of maleic anhydride, while 200000 tons of nitrile latex has been completed and put into production at the end of January, and 200000 tons of MMA has been completed and put into production at the end of March. At present, there are 700000 tons of PDH, 300000 tons of propylene oxide and 200000 tons of maleic anhydride under construction. Due to the impact of plastic restrictions, maleic anhydride downstream PBAT/PBS production capacity ushered in rapid expansion, is expected to lead to a sharp rise in demand for maleic anhydride, a strong support for the price of maleic anhydride. According to Zhuang Chuang's forecast, the domestic production capacity of PBAT/PBS will increase by 6 million tons in the next five years, and the additional demand for maleic anhydride will be about 1 million tons. The company's new production capacity is expected to be fully digested, while helping the company to expand its say in the maleic anhydride market.
Break the foreign monopoly and realize the localization of adiponitrile on the road. The company is currently building a dinitrile-PA66 integration project, which plans to produce 1 million tons of PA66, 500000 tons of hexanediamine and 500000 tons of hexanedionitrile and co-produce 500000 tons of acrylonitrile, using the butadiene synthesis process of Tianchen Company, which is a patented technology with independent intellectual property rights. At present, 100% of adiponitrile in China is completely dependent on imports, and China is the main consumer of PA66 downstream of adiponitrile. After the completion of the project, it will break the foreign technology monopoly and fill the gaps in domestic technology and industry. The construction of the first phase of this project has been started and is expected to be completed in 2023. Compared with other adiponitrile projects in the industry, the company is expected to give full play to the advantage of "Qixiang speed", take the lead in production and give priority to seizing market share.
Investment suggestion: the company focuses on the deep processing of C4 raw materials and the production and sales of high value-added fine chemical products, and has built four product lines of butene, isobutene, n-butane and isobutane. In the future, the company is expected to complete the layout of the industrial chain with the speed of "a project in a year". Acceleration, low cost to achieve the "dry squeeze" of C4 resources, and develop into the leading C4 deep processing industrial base in China.
The company is expected to achieve a net profit of 1.03 billion / 1.97 billion / 2.55 billion in 20-22, with EPS0.58/0.89/1.16, corresponding to PE16.8/10.9/8.4 times, giving a "buy" rating for the first time.
Risk hint: the construction progress of the project is not as expected, the price of the product fluctuates, and the demand falls short of expectations.