On the evening of April 21, the 2021 first quarter report released by Hengli Petrochemical showed that during the reporting period, the company achieved total operating income of 53.233 billion yuan, a year-on-year increase of 78.8%; the net profit attributable to the parent company was 4.111 billion yuan, a year-on-year increase of 9.181% %. The company’s previously announced 2020 annual report disclosed that the annual operating income was 152.373 billion yuan, a year-on-year increase of 51.19%; the net profit attributable to shareholders of listed companies was 13.462 billion yuan, a year-on-year increase of 34.28%.
Rongsheng Petrochemical disclosed its performance forecast. The company expects net profit in the first quarter to be 2.62 billion yuan, an increase of 113.73% over the same period last year. According to the company’s annual report, operating income in 2020 was 107.265 billion yuan, a year-on-year increase of 30.02%; net profit attributable to the parent company was 7.309 billion yuan, a year-on-year increase of 231.17%.
It is understood that the layout of the two companies covers the entire industrial chain from downstream chemical fiber to upstream refining, realizing the advantages of the “one drop of oil to one silk” industrial chain, thus We can rely on the cost reduction brought by the advantages of scale and the synergy brought by the integrated industry to take the lead in major financial indicators such as product cost per ton, gross profit per ton, and sales gross profit margin.
Take Hengli Petrochemical as an example. From its backdoor listing in 2016 to 2020, the company achieved a huge breakthrough in market value from less than 40 billion yuan to over 200 billion yuan. The company’s main business includes PX, acetic acid, PTA, ethylene glycol, polyester chips, civil polyester filament, industrial polyester filament, Production, research and development and sales of new polyester films, engineering plastics, and PBS/PBAT biodegradable materials.
In the 2020 annual report, the company stated that during the reporting period, the company’s operating income, net profit attributable to shareholders of listed companies and net profit after deductions, and net cash flow generated from operating activities The main reason for the substantial increase is that the 1.5 million tons ethylene project, PTA-4 project, and PTA-5 project were put into operation in 2020, and the 20 million tons refining and chemical integration project increased production compared with 2019. Previously, the relevant person in charge of the company told reporters: “An industry-leading company like Hengli with comprehensive cost operation advantages will have an excess profit range of 200 to 300 yuan per ton compared with the industry average.”
Rongsheng Petrochemical stated in its annual report that during the reporting period, various projects of the “40 million tons/year refining and chemical integration project” invested and constructed in Zhoushan Green Petrochemical Base were progressing smoothly. The first phase of the project achieved stable full-load operation. At the same time, the company put the first batch of units of the second phase of the project into operation on November 1 last year based on actual progress. Currently, the second phase of the project is progressing steadily.
While their performance has increased significantly, Hengli Petrochemical and Rongsheng Petrochemical have been favored by funds in the capital market. According to the first quarter report of Hengli Petrochemical, among the company’s top ten tradable shareholders at the end of the first quarter of this year, there were three new tradable shareholders compared with the end of last year.
The four polyester giants have extended the industrial chain upwards, and the companies that have been put into production are the first to enjoy refining profits
Refining and chemical production capacity is the link with the highest investment intensity, the highest approval difficulty, and the longest construction cycle in the entire industry chain. From this perspective Look, the upstream of PX refining is also the most scarce capacity allocation among industry companies. At present, the two major projects of Hengli Refinery and Zhejiang Petrochemical, which have the fastest initial layout, have been put into operation successively. Hengli and Rongsheng are the first to enjoy refining profits and are already in the leading position in the industry.
In addition to Hengli Petrochemical and Rongsheng Petrochemical, there are currently domestic private petrochemical companies with integrated refining and chemical projects including Hengyi Petrochemical. It is reported that the first phase of the company’s 8 million tons refining and chemical project in Brunei was completed and put into operation in November 2019, opening up the entire refining and chemical fiber industry chain, and the second phase is accelerating. On April 19 this year, the company’s annual report showed that during the reporting period, the company achieved operating income of 86.43 billion yuan, an increase of 8.55% from the previous year; the net profit attributable to the parent company dropped slightly by 3.7% year-on-year to 3.072 billion yuan. The company said that its stable performance was mainly due to its advantages in the entire petrochemical industry chain.
Currently, large refining and chemical projects under planning or construction in China include: Shenghong Petrochemical’s 16 million tons/year refining and chemical integration project is expected to be completed and put into operation by the end of this year; Shandong Yulong The first phase of the island’s 40 million tons/year refining and chemical integration project has started and is expected to be completed and put into operation next year.
In the context of this project construction boom and the deepening collaboration of the industrial chain, it has the production capacity scale of midstream PTA and upstream PX Companies with an advantage in the speed of production capacity put into production will have great opportunities and advantages. They will also be the first to enjoy the dividends of the industrial chain and effectively resist the risk of cyclical fluctuations that may come from downstream polyester. In order to catch up with the cycle, time and speed are profits, and those who achieve first come first. Therefore, it is not an exaggeration to say that the past two years have been the “speed of life and death of the industry chain layout” for industry enterprises. At the same time, the industry structure is quietly undergoing great changes, from the “Three Kingdoms Era” of polyester industry competition for many years to the “PX-PTA-polyester” full industry chain competition focusing on upstream development. </p
