Longji'S Next Station Of "Photovoltaic Mao": Certainty And Uncertainty Of "Poetry And Distance"

        From the fourth quarter of 2020, investors began to look forward to the profit prospects of Longji shares in the next year: there is almost a certain speculation in the market that the company's net profit can exceed 10 billion yuan in 2021.

Longji shares the latest annual report, from the side confirmed the possibility of the above speculation. The company announced a revenue target of 85 billion yuan in 2021, a year-on-year increase of 55.73%. Referring to last year's net profit rate, the 21st century economic report reporter estimates that Longji's net profit is expected to exceed 12 billion yuan this year.

From "single crystal leader", "the most profitable photovoltaic company" to "photovoltaic grass", Longji shares have more and more commendatory labels under the rising performance and market value. And its topic is more and more strong. In particular, after the stock price reached a record high in February this year, the future growth of Longji shares has aroused heated discussion.

Indeed, compared with the current domestic competitors, Longji shares have obvious advantages both in terms of fundamentals and market value; Compared with the leading photovoltaic enterprises in history, Longji shares have almost created a new height. But the worries from the capital market are not the wind of holes. After growing into a company with a market value of 100 billion, where is the company's next stop?

New stories must be continued and "poetry and distance" must be written. For Longji, the road to challenge is still full of uncertainty.

"Photovoltaic grass" has no loss

A few days ago, in an institutional teleconference, an "expert" predicted that Longji would lose 1.7 billion yuan in the first quarter. Although the organization holding the conference personally refuted the rumors, explaining that the "expert"'s prediction was not credible, negative emotions were fermented.

Within three trading days after the conference call, Longji's share price fell by more than 12%. Investors have sought "reassurance" on the interactive exchange platform, and the company immediately replied, "the logic and conclusion of the statement (loss of 1.7 billion yuan) is totally inconsistent with the facts, and there is a serious deviation."

On the evening of April 20, Longji's 2020 annual report and 2021 quarterly report finally came out. Investors cheered on the "experts" who beat the market expectations. Indeed, in a sense, Longji is not only a photovoltaic manufacturing company, but also has expectations of nearly 500000 shareholders. The 21st century economic reporter noted that by the end of the first quarter of this year, the total number of shareholders of Longji shares was 497400, which has increased by 3.23 times in the past year.

In response to the first quarter results, an institutional analyst, who did not want to be named, told 21st century economic reporter: "it's very Longji."

"When the market expectations are high, Longji's final performance, though good, is often slightly lower than expected; But when market expectations are low, they always exceed expectations. " The analyst believes that Longji's good first quarter results are "grounded.".

Financial data show that from January to March this year, the company achieved a revenue of 15.854 billion yuan, a year-on-year increase of 84.36%; The net profit attributable to shareholders of listed companies was 2.502 billion yuan, up 34.24% year on year. In fact, this group of performance data shows that Longji's operation in the first quarter of this year is not "amazing", but relatively stable. In the same period of 2020, the company's operating revenue reached 8.599 billion yuan, a year-on-year increase of 50.60%; The net profit attributable to shareholders of listed companies was 1.864 billion yuan, up 204.92% year on year. In the first quarter of last year, the industry suffered from the impact of the new crown epidemic, but the net profit of Longji shares bucked the trend and achieved double growth.

In the same period of last year, the impact on the development of domestic photovoltaic industry was "foreign invasion", that is, the slowdown and contraction of industry production and demand caused by the epidemic. However, in the first quarter of this year, the domestic photovoltaic industry is facing competition "Involution", that is, the production rhythm of upstream and downstream is not coordinated due to the price rise of industrial chain. Even Longji shares are not immune to such negative effects.

"In the first quarter of this year, especially in February and March, the operating rate of domestic component manufacturers is not very high, resulting in the low performance expectation of the market for component enterprises." The analyst told 21st century business reporter.

The rise of silicon material price is a major obstacle for domestic photovoltaic enterprises to further open their production capacity and expand production. As of last week, the vast majority of silicon materials enterprises have signed orders to the end of April or even the middle of May.

To ensure the stability of the supply chain has become an important production strategy for leading photovoltaic enterprises including Longji. One of its manifestations is to lock in raw materials. The reporter of 21st century economic report noted that when the financial report was released on the evening of April 20, Longji also issued a major procurement contract to sign a five-year, 5.5 billion yuan photovoltaic glass purchase agreement with Bengbu Deli light energy materials Co., Ltd.

This is Longji shares "lock material" one of the performance. It can not be ignored that this will bring some pressure on the cash flow of the company in the short term. According to the first quarter financial report, the net cash flow generated by Longji's operating activities was - 1.615 billion yuan, which was enlarged month on month compared with the fourth quarter of last year and the first quarter of last year. In this regard, at the performance presentation meeting, Liu Xuewen, financial director of Longji Co., Ltd., explained: "it is mainly caused by three reasons: first, the advance payment for silicon materials and auxiliary materials has increased; Second, the first quarter is the off-season, with less receivables; Third, due to the impact of shipping and other logistics transportation, inventory turnover caused by components decreased

However, the uncertainty of the future price trend of silicon materials and other industrial chain raw materials is still the main factor affecting Longji's profit this year. In this regard, CICC lowered its previous net profit forecast of 11% to 11.6 billion yuan, taking into account that the price of silicon material has continued to rise since this year, exceeding the expectation at the beginning of the year.

Longji's "poetry and distance"

In February this year, Longji's share price reached a historical record of 125.68 yuan, with a total market value of more than 480 billion yuan. At that time, there was such a voice in the capital market that "it will break 500 billion yuan this year and trillion yuan in five years."

The capital market's expectation of Longji stock price is crazy. But if the market value is to advance again, a new story will continue.

In fact, 21st century economic reporter noticed that Longji is planning the next stop. On the one hand, when the structure of its main products has changed greatly, the competitive environment the company is facing is already different; On the other hand, the imagination of capital market for photovoltaic industry will touch the ceiling sooner or later. In addition to photovoltaic, Longji needs "poetry and distance".

Longji shares this year's revenue target is 85 billion yuan. At the performance presentation meeting, Zhong Baoshen, chairman of the company, further decomposed the data: 21.5 billion yuan for silicon chip, 56.5 billion yuan for component business, and 7 billion yuan for other fields.

According to the financial report in 2020, the component and silicon chip revenue of Longji shares accounted for 66.39% and 28.42% respectively. Combined with the above specific revenue target, it can be seen that the company will continue to rely on the revenue of component business this year, with the predicted revenue accounting for 66.47%.

In 2020, Longji will surpass Jinke energy and become the world's largest component supplier with a market share of 19%. Referring to the company's target this year, its component production capacity is 65gw, and the shipment volume is 40gw, and both production and sales targets have increased significantly.

"The market share of company components will continue to increase this year." Wang Yingge, general manager of Longji Co., Ltd., said in an interview with 21st century economic reporter that although the profit challenge of modules in the photovoltaic industry chain is the biggest due to the shortage of silicon materials and the pressure of price rise, the market share of leading enterprises will increase in the long run, and they will have advantages over the second and third tier enterprises in terms of product premium in the future.

In the existing PV business structure, Longji has expanded its investment in module business. As more and more new entrants come into the market, the separation of Longji and Zhonghuan may be broken in the future. The company also needs to cope with new competition.

"There are a lot of new enterprises in the silicon wafer sector, and the competition will certainly intensify. If the capacity exceeds the demand, the competition will be more and more fierce. " Zhong Baoshen said frankly.

However, in the photovoltaic business, Longji does not seem to be afraid of competition. "The company has been storing up new technology." Wang Yingge told the 21st century economic reporter.

The 21st century economic report reporter noted that at the performance presentation meeting, Zhong Baoshen disclosed the new action of Longji in the battery sector this year. "By the end of this year, the company will put into production two new technology lines of battery capacity, one for ground power stations and the other for distribution, and the efficiency will be significantly higher than the current mass production products."

It is worth noting that Longji is opening up a new business track, and will invest one of its future growth to hydrogen energy.

"We are positioned in the field of green hydrogen and do equipment manufacturing. The core of our company is manufacturing." Wang Yingge told reporters of the 21st century economic report that Longji's hydrogen energy layout focused on electrolytic water related equipment, such as complete sets of equipment and solutions, such as electrolyzers. "It is expected that large-scale production capacity will be formed in the fourth quarter of this year."

21st century economic reporter learned that Longji has listed hydrogen energy as the fifth largest business.