FLAT GLASS(06865.HK):ACCELERATING OVERSEAS EXPANSION
FLAT GLASS(06865.HK):ACCELERATING OVERSEAS EXPANSION
Flat Glass reported 2023 revenue of Rmb21.52bn (+39.2% YoY) and net profit of Rmb2.76bn (+30% YoY), slightly above market expectation. The company declared final cash dividend of Rmb38 cents per share, resulting in a payout ratio of 52.57% in 2023 with 1H23 interim cash dividend of Rmb23.8 cents per share, which exceeds market expectation.
平板玻璃公佈的2023年收入爲215.2億元人民幣（同比增長39.2％），淨利潤爲27.6億元人民幣（同比增長30％），略高於市場預期。該公司宣佈末期現金分紅爲每股38美分，2023年的派息率爲52.57％，23年上半年的中期現金分紅爲每股人民幣23.8美分，超出市場預期。
Gradual earnings recovery in solar glass sector. During 4Q23, the company realized revenue of Rmb5.64bn (+32.8% YoY, -9.1% QoQ), and net profit of Rmb791.1mn (+27.9% YoY, -10.5% QoQ). Overall gross margin recorded 23.4% (-1.1pct QoQ), and net profit margin recorded 14.0% (-0.2pct QoQ). GPM of solar glass sector reported 24.4% in 2H23, representing 4.4pct increase as compared to 20.0% in 1H23, mainly due to relieved cost pressure of soda ash.
太陽能玻璃行業的收益逐步恢復。在23年第四季度，公司實現收入爲人民幣56.4億元（同比增長32.8％，環比下降9.1％），淨利潤爲人民幣7.91億元（同比增長27.9％，環比下降10.5％）。總毛利率錄得23.4％（環比下降1.1個百分點），淨利潤率錄得14.0％（環比下降0.2個百分點）。太陽能玻璃行業的GPM在23年下半年報告了24.4％，與23年上半年的20.0％相比增長了4.4個百分點，這主要是由於純鹼的成本壓力得到緩解。
Accelerated overseas capacity expansion. The company delayed its expansion in 2H23 because of the long-awaited hearing approval of domestic projects from the government. Total capacity only reached 20,600tons/day (+6% YoY) by end of 2023. In 2024, the company accelerated its capacity expansion. According to management, Anhui project with capacity of 4*1,200tons/day will start production in March and Nantong project with capacity of 4*1,200tons/day will be commissioned in August. By end of 2024, the company will reach capacity with 30,200tons/day (+47% YoY). In 2025, the company plans to construct 6 production lines with capacity of 8,800tons/day but has not got the government approval yet. Hence the expansion timeline of the its domestic projects is uncertain. Due to the restrict domestic policies, the company also seeks expansion in Indonesia and Vietnam with capacity of 2*1,600tons/day and 1*1,600 tons/day respectively, which will be commissioned in 1H26. Currently it has capacity of 2,000tons/day in Vietnam. Since overseas price of solar glass is Rmb1- 2/sqm higher than domestic price and raw material costs are lower, we believe the overseas expansion will strengthen the company's global supply capacity and improve its profitability.
加速海外產能擴張。由於期待已久的政府對國內項目的聽證批准，該公司在23年下半年推遲了擴張。到2023年底，總產能僅達到每天20,600噸（同比增長6％）。2024年，該公司加快了產能擴張。據管理層透露，日產能爲4*1,200噸的安徽項目將於3月開始生產，產能爲4*1,200噸/日的南通項目將於8月投產。到2024年底，該公司的產能將達到每天30,200噸（同比增長47％）。2025年，該公司計劃建造6條生產線，產能爲8,800噸/天，但尚未獲得政府的批准。因此，其國內項目的擴張時間表尚不確定。由於國內政策的限制，該公司還尋求在印度尼西亞和越南進行擴張，產能分別爲2*1,600噸/天和1*1,600噸/天，將在26年上半年投產。目前，它在越南的產能爲每天2,000噸。由於太陽能玻璃的海外價格比國內價格高出人民幣1-2元/平方米，而且原材料成本較低，我們認爲海外擴張將增強公司的全球供應能力並提高其盈利能力。
Downstream demand is booming. Domestic solar installation reached 36.72GW (+80% YoY) in the first two months of 2024. Moreover, module manufacturers plan 60GW+ production in April. We believe downstream demand is solid in 2024. As for supply, currently the solar glass industry supplies could satisfy roughly 50GW per month thanks to the slowed down industry expansion regulated by the government. The industry inventories of solar glass have continued to decline for 3 consecutive weeks since March and are currently at a level of 21.59 days. According to Infolink Consulting, 3.2mm coated solar glass experienced a small price hike of Rmb0.25 this week. We believe ASP of solar glass will remain stable in 2024 due to a favorable supply-demand environment.
下游需求正在蓬勃發展。2024年前兩個月，國內太陽能裝機量達到36.72吉瓦（同比增長80％）。此外，組件製造商計劃在4月份產量超過60GW。我們認爲，2024年的下游需求將保持穩健。至於供應，由於政府監管的行業擴張放緩，目前太陽能玻璃行業的供應量可以滿足每月約50吉瓦的需求。自3月份以來，太陽能玻璃的行業庫存連續3周持續下降，目前爲21.59天。根據Infolink Consulting的數據，本週3.2毫米鍍膜太陽能玻璃的價格小幅上漲了0.25元人民幣。我們認爲，由於良好的供需環境，太陽能玻璃的ASP將在2024年保持穩定。
Maintain Buy rating. We slightly lift ASP assumption of solar glass and revise down the effective capacity forecast of the company in 24-26 according to its updated expansion plan in our model. Given the uncertainty of the government approval, the company's 2025 planned domestic projects are excluded from our forecasts in a cautious manner. We therefore revise our EPS forecasts in 24-25E, from Rmb1.66 to Rmb1.71 in 24E (+38.7% YoY), from Rmb2.05 to Rmb2.32 in 25E (+35.1% YoY), and forecast EPS of 2.32 (+0.1% YoY) in 26E. We slightly cut our target price from HK$29.5 to HK$27.8 to reflect a small decrease in 24E net profit (24E EPS was revised up because of decreased shares number), representing 15x 24E PE. With solid demand and cost reduction, we believe the company will see an improved margin in 2024. We therefore maintain our buy rating.
維持買入評級。根據模型中最新的擴張計劃，我們略微提高了ASP對太陽能玻璃的假設，並下調了該公司在24-26年的有效產能預測。鑑於政府批准的不確定性，我們謹慎地將該公司2025年計劃的國內項目排除在我們的預測之外。因此，我們將24-25E的每股收益預測從1.66元上調至24E的1.71元人民幣（同比增長38.7％），從2.05元人民幣上調至25E的2.32元人民幣（同比增長35.1％），並預測26E的每股收益爲2.32元（同比增長0.1％）。我們將目標價格從29.5港元小幅下調至27.8港元，以反映24E淨利潤的小幅下降（由於股票數量減少，24E每股收益上調），相當於24E市盈率的15倍。憑藉穩健的需求和成本的降低，我們相信該公司的利潤率將在2024年得到提高。因此，我們維持買入評級。
Risks: downstream demand below expectation. Capacity expansion below expectation. Industry oversupply above expectation.
風險：下游需求低於預期。產能擴張低於預期。行業供過於求超出預期。
譯文內容由第三人軟體翻譯。