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阜丰集团(00546.HK):1H21业绩符合预期 静待需求恢复

Fufeng Group (00546.HK): 1H21 performance is in line with expectations, waiting for demand to recover

中金公司 ·  Aug 31, 2021 00:00

1H21 performance is in line with our expectations

The company announced 1H21 results: revenue 9.521 billion yuan, year-on-year + 16.5%, month-on-month 11.7%; return to the mother net profit of 591 million yuan, corresponding to 0.23 yuan per share, year-on-year + 55.9%, month-on-month + 135.5%; gross profit margin rose 2.7ppt to 18.5%, in line with expectations. The large increase in profit is mainly due to the simultaneous rise in the volume and price of threonine and the smooth transfer of corn cost pressure on products such as monosodium glutamate.

From a sub-sector point of view, the revenue of food additives, animal nutrition, high-grade amino acids and colloids is 44.95pm 34.62max 6.88 / 396 million, accounting for 47.2%, 36.4%, 7.2%, 4.2%, respectively, and the gross profit margin is 13.4%, 17.7%, 44.8%, 38.1% respectively.

Trend of development

The pattern of amino acid products is improving, and the company's core competitiveness is strong. The current average market price of threonine / lysine is about 11,500 Compact 9130 yuan / ton, compared with the same period last year, + 38.6% Compact 24.2%. With the gradual withdrawal of inefficient production capacity of amino acid products and the improvement of the industry pattern, we believe that the product price center is expected to rise. At the same time, the company has the advantages of scale / cost / diversified layout, we are optimistic about the competitiveness of the company in the future. Raw materials support the high price of monosodium glutamate, waiting for the recovery of industry demand. In terms of supply, the oligopoly structure of the monosodium glutamate industry is stable, with a production capacity of about 80 per cent of CR3 and a total market share of nearly 90 per cent. The overall supply of the industry slightly exceeds the demand, and the company's production capacity ranks first in the industry; from the point of view of demand, the food processing and additives in the downstream demand structure of monosodium glutamate are nearly 50%, and the catering consumption is nearly 30%, 40%. The demand for monosodium glutamate is weak affected by the epidemic. At present, the market price of monosodium glutamate is 8000 yuan / ton, which is supported by cost to return to the uplink channel. In terms of price difference, the price of monosodium glutamate-corn is currently 2651 yuan / ton, which is still at a five-year low. Looking forward, we believe that the marginal impact of the epidemic has weakened, demand is expected to recover as the economy recovers, and we expect industry coordination to improve, and monosodium glutamate boom is expected to pick up in the second half of the year.

Profit forecast and valuation

Keep profit forecasts for 2021 and 2022 unchanged. The current share price corresponds to 5.2 times 2021 / 2022 / 4.5 times earnings. Maintain an outperform industry rating and a target price of HK $3.60, corresponding to 6.8 times 2021 price-to-earnings ratio and 5.9 times 2022 price-to-earnings ratio, with 32.8% upside compared with current share prices.

Risk.

The recovery of demand is not as expected and the cost transmission is not smooth.

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