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Meet Jiangsu Thorpe
Jiangsu Thorpe, coordinates Zhenjiang, Jiangsu, listed in 1996
The company's main products are acetic acid and derivatives, which belong to the standard chemical industry, and the downstream application range is extremely extensive
The company has an annual output of 1.2 million tons of acetic acid, 300,000 tons of ethyl acetate design and production capacity
The industry is mainly affected by the macroeconomic cycle and upstream and downstream supply and demand, with certain cyclical characteristics, and will still bear the pressure brought by the uncertainty of economic development, energy price fluctuations, environmental protection and safety supervision and other aspects in the future
The specific products and upstream and downstream related series are shown as follows:
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products
Subdivision industry
The main upstream raw material
Main downstream application areas
The price is the main influencing factor
acetic acid
chemical industry
coal
PTA, vinyl acetate
Raw material prices and market supply and demand
ethyl acetate
Acetic acid, ethanol
Coatings, inks, adhesives
sulphuric acid
Liquid sulfur
Chemical raw materials
ADC blowing agent
Urea, chlor-alkali, etc
Plastic, rubber foam, wallpaper, artificial leather, etc.
Raw material prices and market supply and demand.
In 2020, R&D investment is 150 million, and R&D revenue accounts for 4%, which does not reach the basic line of 5%, but depending on this small-scale chemical enterprise, the proportion is already possible
In 2020, the company achieved an operating income of 3.795 billion yuan and a net profit attributable to shareholders of listed companies of 231 million yuan. The company's acetic acid, derivatives and sulfuric acid assets injected through major asset restructuring were consolidated in December 2019, and the company's operating income increased by 542.67% over the same period of the previous year, and the net profit turned into a profit and increased significantly.
Affected by the epidemic, due to the joint effect of factors such as restricting logistics, people flow and other epidemic prevention and control policies, blocked foreign trade exports, a sharp decline in crude oil prices and periodic maintenance and shutdown, the company's production and sales in the first three quarters of 2020, product prices have declined significantly, resulting in the company's operating performance in the first three quarters of 2020 failing to complete the timing progress, and a large decline than expected. Since October, the downstream market has picked up, the price of acetic acid products has risen sharply, and the company's profit level in the fourth quarter has continued to rise, but it has not been able to complete the performance commitment of major asset restructuring throughout the year.
2021Q2 Acetic acid domestic plant frequent maintenance, overseas demand is strong, acetic acid prices continue to be high supply side, since 2021, the 1.3 million tons of acetic acid plant in the United States was once parked due to severe cold weather, the Singapore plant was unstable, and overseas supply was deeply disturbed. Q2 There are still many sets of devices in China that are unexpectedly stopped or overhauled. On the demand side, overseas real estate continued to boom, and the demand for acetic acid was strong, stimulating a significant increase in Q2 acetic acid exports. According to Baichuan Yingfu, in April 2021, the export volume of acetic acid reached 135,800 tons, a year-on-year +208.77%; in May, the export volume of acetic acid reached 93,400 tons, a year-on-year +626.01%. Under the mismatch between supply and demand, the price of acetic acid continues to be high. According to Zhuo Chuang Information, the average annual price of acetic acid in Q2 2021 reached 7,604 yuan / ton (+228.12% year-on-year)
2020 revenue of 3.8 billion, the past 5 years revenue compound growth rate of 43%, the past 10 years of revenue compound growth rate of 16%, it should be said that 2020 compared to 2019 growth is still relatively rapid, an increase of 6 times, 2021Q1 compared with 2020Q1 and 1 times, the momentum is good
In terms of gross profit margin, the fluctuation between the years is larger, the gross profit margin in 2020 is 16%, almost double that of 2019, and the 2021Q1 is as high as 43%, which suddenly has a feeling of complete explosion
Free cash flow 530 million in 2020, 29% cagring free cash flow over the past 5 years, 34% capped over the past 10 years
At the end of 2020, the financial assets are 200 million, and the interest-bearing liabilities are 200 million, and the scale is still in the development stage
02
Jiangsu Thorpe valuation
Based on 2020 free cash flow, we combine past revenue and cash flow growth, assuming a compound growth rate of about 20% in the next 10 years, and the valuation is as follows:
unscramble:
The company's main product is acetic acid, the above content has been prompted, this chemical product cycle volatility is relatively large, and these two years, especially the recent first half of 2021, the price of acetic acid is more doubled, the company benefited more
Coupled with the company's asset injection and other factors, the volume and price rise together, the stock price is difficult to think of not rising, just so-called, who is not yet eating dumplings in the year
But frankly speaking, the compound growth rate of 20% is not easy to achieve, especially if it catches up with the bad year, it is really difficult to say, however, in the current highly prosperous situation in the industry, let's be optimistic for the time being, the valuation of 18.72 yuan, in principle, there is still nearly two boards of space, but if the market sentiment rises, it is not known whether it will rise by 20%-30% on the basis of 18.72
So, this ticket is like what we said in the last article, if it happens to catch the wind outlet, fasten your seat belt and wait for it to take off, but still exhort, don't be greedy
Personal judgment, do not make investment recommendations, like please add off
Dongliang Kong, CPA
2021/7/10