\u3000\u3000 Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) (603466)
Event: the company released the performance forecast for 2021. It is estimated that the revenue in 2021 will be 2.94 billion yuan (YoY + 30.31%), the net profit attributable to the parent company will be 454 million yuan (YoY + 32.47%), and the net cash flow from operating activities will be 325 million yuan (YoY + 48.37%). As of December 31, 2021, the company’s orders on hand will be about 5.462 billion yuan, an increase of about 1.39% over the end of the previous year; It is estimated that the single quarter revenue of 2021q4 is 693 million yuan (YoY + 14.36%), and the net profit attributable to the parent company is 63 million yuan (yoy-7.35%, qoq-43.24%), which is expected to decline significantly month on month, mainly affected by the recognition of Q4 bonus.
The transformation of business structure drove the steady growth of revenue, the amount of orders on hand was stable, and the operating cash flow continued to improve. As a leader in the exhibition industry, the company has sustained steady growth in performance for eight years, participated in the construction of 1300 + venues, has a large-scale 3D design and development team, and the basic business of urban digital experience space has remained stable driven by business sinking and renovation demand. Cultural and digital brand space has large business space, fast growth and high gross profit. According to the on hand order data of 2021h1, the on hand order proportion of the company’s culture and digital branding experience space has reached 51.09%. The success of the company’s new business expansion will better help the company’s performance achieve long-term, stable and high growth. The company has stable customer structure, low order bad debt risk and abundant on-hand orders. The amount of on-hand orders in recent three years is RMB 4.969/53.87/5.462 billion, and the newly signed orders in 2019 / 2020 are RMB 2.068/3.069 billion. The improvement of order digestion speed and the certainty of performance are guaranteed. The operating cash flow of the company continued to improve, and the net operating cash flow of the company in recent three years was RMB 253 / 2.19/325 million respectively.
Consolidate the role of “construction team” of yuanuniverse, and constantly implement cooperation and scenes. The company has the strength of content + space building of yuancosmos infrastructure, has great application opportunities in yuancosmos, and actively invests and arranges the business of yuancosmos: 1) yuancosmos infrastructure: on January 13, the company announced that it had reached an ecological cooperation relationship with Baidu. As one of the virtual 3D developers of Greek yuancosmos, the company undertook the development, building and content operation of 3D virtual architecture and digital space, And launched Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) venues in xirang. In addition, the company also signed meta universe cooperation business with many local governments to help the government realize the scene landing in meta universe space; 2) NFT: the company invested in the NFT distribution technology company Xingtu bit and jointly launched China’s first NFT expression pack digital collection; 3) Yuancosmos Entertainment: the company has reached strategic cooperation with Wanda studios and Xingyi studios to create virtual scenes in the era of yuancosmos pan entertainment; 4) Virtual human: on January 29, the company launched the virtual human xiao’an of Anhui TV station and participated in the recording of Anhui Spring Festival Gala.
Investment suggestion: with the success of the company’s business structure transformation and the expansion of yuancosmic’s business, the company is expected to usher in a dual engine profit driven. However, considering the early investment of yuancosmic’s business, we expect the company to achieve a revenue of 3.467/4.102 billion yuan in 2022 / 2023, reduce the net profit attributable to the parent company to 554/703 million yuan in 2022 / 2023, and maintain the “buy” rating.
Risk warning: the business development of yuancosmic is less than the expected risk, and the competition intensifies the risk
