Core ideas:
The company publishes its annual report for 2020 and quarterly report for 2021. Over the past 20 years, the company achieved revenue of 2.414 billion yuan, an increase of 12.58% over the same period last year, and a net profit of 176 million yuan, an increase of 18.36% over the same period last year.
The company's 21Q1 realized revenue of 710 million yuan, an increase of 78.03% over the same period last year, and a net profit of 60.44 million yuan, an increase of 235.97% over the same period last year.
Q1 the volume and price of all kinds of tape have risen, and the cost of raw materials has also increased. According to the company's operating data announcement, the revenue of 21Q1 film-based tape, paper-based tape and cloth-based tape reached 317 million yuan, 196 million yuan and 121 million yuan respectively, an increase of 83.5%, 95.3% and 21.8% over the same period last year, while sales increased by 54.7%, 85.1% and 9.9% respectively, and the average sales price increased by 19.3%, 5.3% and 10.9% respectively. In terms of raw materials, the average purchase prices of 21Q1 resin, OPP film, particles, butyl ester, pulp and PVC powder increased by 0.2%, 17.1%, 23.0%, 78.2%, 9.6% and 12.6%, respectively.
There is a bright future in the tape market, and the company's production capacity layout continues to advance. According to the annual report, the sales of adhesive tape in China in 2019 was 46.55 billion yuan, an increase of 8% over the same period last year, of which the sales growth rates of BOPP tape, PVC tape, American paper tape, other and special adhesive tape were 9.6%, 11.7%, 18.2% and 12.8%, respectively. The project under construction continues: four BOPP film drawing lines have been put into production, and the 234th line is expected to be gradually put into production from the end of 2021 to the middle of 2022; the American pattern paper and cloth base tape project raised by IPO is expected to be put into production in 2021; the construction project of environmental degradable new materials production base is expected to start in the second half of 2021 and reach the expected state of use in 2023; wire harness, medical tape integration and manufacturing base construction project is expected to be completed in mid-2023.
Profit forecast and investment advice. It is estimated that the company's earnings per share in 21-23 years are 1.57 yuan, 2.11 yuan and 2.64 yuan respectively, and the current share price is 15 times, 11 times and 9 times respectively. With reference to the valuation level of the comparable company, taking into account the company's business structure and performance growth, the company's performance in 2021 is valued at 20 times PE, corresponding to a reasonable value of 31.39 yuan per share, maintaining a "buy" rating.
Risk tips. The price of tape products has fallen sharply; downstream demand is in the doldrums; international trade frictions are intensified and exchange rate fluctuations are risk; the progress of projects under construction is lower than expected; major safety and environmental accidents.