Daily plastic products are not easy to do Camellia shares have newly entered the degradable plastic products track

Financial Associated Press (Xiamen, reporter Li Zijian) news, due to the epidemic on the terminal retail industry has a greater impact, last year Camellia shares (603615. SH) revenue suffered, while this year's sharp increase in costs has eaten up profits. Daily plastic products business is difficult to do, on the evening of December 14, camellia shares disclosure announcement showed that it is planned to increase into the degradable plastic products track.

The relevant person in charge of the company told the Financial Associated Press that the company's entry into the degradable plastic products industry is mainly film bag products, such as plastic wrap, garbage bags and shopping bags. From the perspective of the industry, degradable plastic products as a policy-oriented support industry, the company is optimistic about its future market demand; from its own company for many years of deep ploughing in the field of daily plastic products business, whether it is customers or distributors are deeply overlapping, membrane bag products in terms of sales relatively have greater advantages.

In order to "promote the product structure adjustment and industrial strategy upgrading of the company's membrane bag products", Camellia plans to raise no more than 400 million yuan for the construction project of the production base of degradable plastic products and supplementary working capital. Among them, the total investment of the project is 350 million yuan, which will be jointly built by the two production bases of Lianjiang and Chuzhou, and the construction period is expected to be 2 years, and the production capacity of 35,000 tons of degradable plastic products will be added to the production year.

From the perspective of expected investment income, the above-mentioned investment in degradable plastic products is not a better business than the former main business "Camellia Household Products Manufacturing Center Project". According to the company's forecast, the internal rate of return after income tax for the production base of degradable plastic products is 20.11%, and the static investment payback period (including the construction period) after income tax is about 6.74 years. The latter, on the other hand, expects a financial internal rate of return (after income tax) of 32.42% and a dynamic payback period of 5.91 years (after income tax).

But the track of degradable plastic products is undoubtedly more "exciting" for investors than plastic household products. Degradable plastics (BK0909) show that the sector index, despite rising and falling back during the year, rose nearly 35% as of December 14. The market generally believes that this market demand will grow with the increase in plastic bans and the continuous expansion of the application of degradable plastics.

Huaan Securities related research report pointed out that the nationwide plastic ban policy promoted by China this time will drive the steady growth of domestic demand for degradable plastics. By 2025, the demand for degradable plastics in China is expected to be 2.38 million tons, and the market size will reach 47.7 billion yuan.

In terms of 2020 data, production capacity is still far from meeting the demand in 2025. According to data from the National Bureau of Statistics, the total output of plastic products in China in 2020 was 76.032 million tons, and the current mainstream products of biodegradable plastics are PBAT and PLA, and their existing total production capacity totals 426,000 tons, accounting for less than 1% of the total output of plastic products.

Degradable plastics as the upstream of degradable plastic products, its situation also reflects the climate of the industry to a certain extent. Despite the huge space for degradable plastics, many listed companies have actively laid out production capacity, it is worth noting that Kingfa Technology (600143. SH) recently said in the interactive platform that due to the market demand has not been fully opened, coupled with the high price of raw materials, the company's PBAT production line is not fully produced.

However, the above-mentioned person in charge of Camellia Shares believes that with the promotion of the "plastic ban order", plastic products with degradable characteristics will gradually replace traditional non-degradable plastic products, and the potential market demand for degradable plastic products is expected to continue to grow. At the same time, degradable plastic products are an important position for the future development of the plastic products industry, but also a new direction for the future transformation and development of traditional plastic processing and production enterprises, the company in order to comply with the development of the industry, seize market opportunities.