Focus on the three main industries of "tungsten and molybdenum + rare earth + cathode materials". The company announced on August 18 that it intends to divest the loss-making real estate business and focus on the development of the three main industries. At present, it has a complete industrial chain of tungsten, molybdenum and rare earths. Xiamen Tungsten Xinneng, the main body of cathode material business, was spun off and listed on Science and Technology Innovation Board on August 5. The company has set up a 5 billion-scale New Materials Fund to invest in the field of new materials and the upstream and downstream of the industrial chain.
The layout of tungsten and molybdenum industry chain, the profitability of cemented carbide is improved. The price of tungsten rebounded steadily in the first half of the 21st century, and it is expected that the price for the whole year is too high, with an average price of about 100,000 yuan per ton. The company has the whole tungsten industry chain, tungsten mining relies on three major production bases, APT accounts for 20%, cemented carbide bars are under construction capacity of 7200 tons / year, CNC blades are under construction capacity of 1000 million pieces / year. Tungsten and molybdenum business is expected to contribute 700 million profits in 21 years.
One of the six major rare earth groups to build an integrated industrial chain. The company is one of the six major rare earth groups, with a complete industry chain from rare earth mines to downstream permanent magnet motors. Limited by mining targets, the company currently has a production capacity of 3000 tons / year for rare earth metals, 3000-4000 tons / year for rare earth oxides, 6000 tons / year for rare earth magnetic materials and 4000 tons / year under construction. The rare earth business is expected to contribute 200 million profits in 21 years, and the company's stake in the permanent magnet motor industrial park project is expected to reach production and release profits in 22 years, and contribute 50 million and 100 million investment income in 22 years and 23 years respectively.
The largest manufacturer of cathode materials in China, with a long-term planned production capacity of 260,000 tons / year. The company's sales volume and market share of cathode materials have ranked first in the industry for three consecutive years, and the market share of lithium cobalt oxide is close to 40%, which is the absolute leader in the industry, and the market share of ternary materials is in the top five in the industry. At present, the company has a production capacity of about 60,000 tons / year of cathode materials, with a planned production capacity of 260,000 tons / year in 23 years, in which the first phase of the 10,000-ton high-nickel ternary production line of Haiyang base has been in the commissioning stage. Ningde base high-nickel ternary technical transformation and expansion project is in the project and equipment bidding stage, the follow-up increments are lithium iron phosphate positive and high nickel ternary positive. The cathode materials business is expected to contribute 600 million in profits in 2021.
Profit Forecast & Investment suggestion
It is estimated that the net profit of 21-23 years is 1.513 billion yuan, 2.359 billion yuan and 3.442 billion yuan, and the realized EPS is 1.07,1.66,2.43 yuan respectively, and the corresponding PE is 29 times, 19 times and 13 times respectively.
The segment valuation is used in the valuation, the market value of tungsten and molybdenum business is 31.5 billion yuan, the market value of rare earth business is 9 billion yuan, the market value of battery material business is 21 billion yuan (corresponding to 46% of the shareholding), the comprehensive market value of the company is 61.5 billion yuan, and the corresponding target price is 43 yuan. For the first time, the coverage was given a "buy" rating.
Risk hint
The risk of raw material supply and price fluctuation; the risk of high concentration of downstream customers; policy risk and so on.
