Key elements of the report:
On July 30, 2021, Lianchuang issued an announcement on investment in new construction projects. The company plans to invest 6000 tons / year PVDF and supporting 11000 tons / year HCFC-142b co-production 30000 tons / year HFC-152a reconstruction project.
Main points of investment:
Under the imbalance between supply and demand, the prices of PVDF and its raw materials have "skyrocketed", and the growth rate has not slowed down in the short term: recently, fluorochemical material PVDF has been pushed into the hot spot because of the rapid growth of demand in downstream new energy fields such as lithium electricity and photovoltaic. Due to the limited production of R142b on the raw material side and the limited new production capacity of PVDF on the supply side in the short term, the supply and demand structure of the industry is obviously out of balance, resulting in PVDF and its raw material prices rising rapidly throughout July and there is no trend of price growth slowing down in the short term. According to Baichuan Yingfu data, as of August 1, the quotations for PVDF powder, granule and lithium battery binder in East China were 200,000 yuan / ton, 190,000 yuan / ton and 230,000 yuan / ton, respectively, up 100%, 72.73% and 53.33% from the previous 30 days. In terms of raw materials, Zhejiang Sanmei and Shandong Huaan R142b quoted prices of 95,000 yuan / ton and 100,000 yuan / ton respectively on August 1, up 46.15% and 53.85% respectively over the previous 30 days. Considering that there are only a small number of PVDF production plans in the second half of the year, it is difficult to reverse the imbalance between supply and demand of PVDF in the short term, we believe that there is still room for subsequent PVDF prices to rise, and before PVDF reaches its production peak in the second half of 2022, its prices will remain high. R142b on the raw material side will continue to explore prices under the dual factors of tight supply and downstream PVDF pulling in the same direction, and will maintain a high operation trend until the second half of next year. In the meantime, we will continue to be optimistic about the enterprises that own PVDF and its raw material capacity layout at the same time.
Actively grasp the market tuyere, subsidiary Huaan new materials re-expansion of PVDF and its raw materials: joint venture subsidiary Huaan new materials existing 20000 tons / year R142b theoretical production capacity and 8000 tons / year PVDF capacity planning, of which PVDF phase I production capacity of 3000 tons will be put into production in August, which is also the main new capacity of China's PVDF industry in the second half of the year. Based on the recent PVDF production plan and the advantage of R142b production quota, the company's dynamics have also attracted much attention from the market in the near future. On July 30, the company announced that subsidiary Hua'an New Materials plans to expand production of 6000 tons / year PVDF and its supporting raw materials R142b1.1 10,000 tons / year, and plans to expand production of R142b main raw materials R152a 30,000 tons / year. After the completion of the project, the company's total PVDF production capacity will increase to 14,000 tons / year, and the production capacity of vinylidene fluoride (VDF) plant will be expanded from 8600 tons / year to 15000 tons / year. At the same time, it will also be able to meet the new demand of R142b raw material R152a from other enterprises in the industry. After all reaching production, it is expected to achieve an annual operating income of 12-1.5 billion yuan. It will play a positive role in promoting the company's future production scale, revenue and profitability, as well as its comprehensive competitiveness in the field of fluorine chemical industry. And considering that this belongs to capacity expansion, its construction cycle is shorter than that of new capacity construction. We believe that under optimistic circumstances, the company's new capacity is expected to be put into use at the end of 2022, that is, before and after the industry enters the peak of production, and we are optimistic about the company's performance growth in the past two years.
Profit forecast and investment suggestion: the operating income of the company from 2021 to 2023 is estimated to be 21.903.850max 4.740 million yuan respectively, the net profit returned to the mother is 5.6160pm 1.660 billion yuan respectively, the EPS is 0.48pm 1.38pm 1.44 respectively, and the corresponding Pamp E is 28.3pm 9.9pm 9.5 (corresponding to the closing price on July 30, 13.65RMB). Maintain a "buy" rating.
Risk factors: the risk of limited start-up of products affected by environmental protection policies; the risk that the construction schedule of PVDF is not as expected; the risk that the project under construction is not as expected; the risk of substantial fluctuations in product prices; the risk of personnel change of management; the risk of lower-than-expected operating benefits resulting from the follow-up construction and use of this production expansion project; and the risk of information asymmetry caused by untimely or incomplete information disclosure. Recently, the company has received two letters of concern due to the fact that the volatility of the stock price has obviously deviated from the increase of the industry, and the risk of significant fluctuations in the stock price has not been ruled out in the later stage.