The company released its annual report for 2020 and quarterly report for 2021, with a decline in profits in 2020 and a return to growth in 2021Q1 profits; the company's customer structure has been continuously optimized and its rating has been maintained.
Support the main points of rating
Profits declined in 2020, and 2021Q1 profits returned to growth: the company released its annual report in 2020, with operating income of 416 million yuan, down 35.55% from the same period last year; net profit of shareholders belonging to listed companies was 45.45 million yuan, down 26.32% from the same period last year; and net profit after deducting 33.44 million yuan, down 33.63% from the same period last year.
The company also released its quarterly report for 2021, with an operating income of 156 million yuan, an increase of 179.02% over the same period last year, and a net profit of 20.11 million yuan for shareholders of listed companies, an increase of 455.95% over the same period last year.
The production and marketing of negative materials declined in 2020 compared with the same period last year, and the profitability has improved: by the end of 2020, the company has completed a production capacity of 30,000 tons, is under construction (fund-raising projects), and has an actual effective production capacity of 25470 tons in 2020. In 2020, the output was 17400 tons, down 2.20% from the same period last year; the sales volume was 14500 tons, down 10.56% from the same period last year. On the one hand, the company has increased the elimination of small and medium-sized customers who are not in a timely manner to limit shipments; on the other hand, it takes time for the anode materials of new models to upgrade from product performance to production capacity preparation. The company's 2020 gross profit margin of negative materials was 28.77%, an increase of 6.80% over the same period last year; the company's 2021Q1 comprehensive gross profit margin was 27.10%, which was higher than the same period last year.
Continuous optimization of customer structure: the company has become a qualified supplier of LG chemistry in November 2019, and continues to maintain a good strategic cooperative relationship in 2020, with orders rising steadily. In April 2020, the company officially became a qualified supplier of Samsung SDI. Samsung SDI began to purchase the company's products on a small scale for trial production and commissioning from June 2020. Batch supply is delayed due to the impact of the epidemic. With the effective control of the domestic and international epidemic, it is expected to supply in bulk in the fourth quarter of 2021. At present, the company is working with SKI, Panasonic and other international well-known battery manufacturers to carry out cooperation negotiations and related certification.
Valuation
Combined with the company's 2021 annual report and the company's quarterly report for 2021, we adjusted the company's earnings per share forecast for the period from 2021 to 2023 to 1.20pm 1.87pm 2.49 yuan (the original forecast was 1.40pm 2.13max-yuan), corresponding to a price-earnings ratio of 35.9pm 23.0pm 17.3 times; the company's current valuation is low and the overweight rating is maintained.
Main risks faced by rating
The price competition of negative materials is higher than expected; the introduction of major customers of the company is not up to expectations; the demand of the new energy vehicle industry chain is not up to expectation; the risk of price fluctuation of raw materials; the risk of accounts receivable of the company; the impact of COVID-19 epidemic is more than expected.
