\u3000\u3000 Avic Jonhon Optronic Technology Co.Ltd(002179) (002179)
Event: Recently, the company released the performance express for 2021: the operating revenue in 2021 was 12.9 billion yuan, yoy + 25.18%; The net profit attributable to the parent company was 1.991 billion yuan, yoy + 38.37%; Deduct non net profit of 1.908 billion yuan, yoy + 38.30%. In a single quarter, the net profit attributable to the parent company from Q1 to Q4 in 2021 was 624 million, 490 million, 509 million and 368 million respectively, with a year-on-year growth rate of 281.43%, – 1.96%, 16.71% and 8.35% respectively. At the end of the reporting period, the total assets of the company were 26.997 billion yuan, yoy + 40.47%; Net assets: 14.927 billion yuan, yoy + 53.27%; The weighted average roe was 18.22%, yoy + 2.14%.
Strong downstream demand and increasing profitability. 1) The three businesses go hand in hand. In 2021, the company continued to maintain growth momentum in both revenue and profit sides. In the field of defense, the company went all out to ensure production and delivery and continuously improve market recognition; The adjustment of communication and industrial business has achieved initial results, and breakthroughs have been made in intelligent travel, data center and other fields; In the new energy vehicle business, the company grasped the growth opportunity of the industry, deepened the cooperation with key customers, steadily improved the penetration rate of mainstream vehicle series, and doubled the order. 2) Pay attention to the cultivation of basic R & D ability. The company continued to increase R & D investment. From Q1 to Q3 in 2021, the proportion of R & D expenses in total operating revenue was 8.32%, 8.73% and 9.17% respectively, with a year-on-year increase of 0.43ppt, 1.10ppt and 1.48ppt respectively. The company continues to carry out scientific research projects and strengthen the construction of core competence. 3) Reduce cost and increase efficiency and improve operation quality. The company refined the cost management unit, took multiple measures to reduce costs and increase efficiency, and deeply promoted the adjustment of product structure and business structure, which significantly improved the operation quality. Under the dual effects of the expansion of electrical connectors with high profit margin and the continuous increase in the proportion of revenue, the profitability of the company has the potential to further improve.
Raise 3.4 billion yuan to expand production and energy, and further open up room for growth. The company will increase 35576016 shares and be listed on Shenzhen Stock Exchange on January 17, 2022. The fund raised is 3.4 billion yuan, and it is planned to invest 1.1 billion yuan and 1.3 billion yuan respectively for the construction of “South China industrial base project” and “phase I project of basic device Industrial Park”. The South China industrial base project aims to help the company adapt to the development trend of the industry and meet the strategic needs of developing high-speed connector business related to communication and new energy vehicle industry in the future. The construction period is 48 months and the after tax internal rate of return is 13.29%. The basic device industrial park project is positioned as the R & D and production base of basic device industries such as interconnection products and airworthiness business in special defense fields. The products are positioned as special optical fiber connectors and components, aviation integrated electronic interconnection system and fluid connectors. The construction period is 30 months and the after tax internal rate of return is 17.20%. With the smooth expansion of production capacity and the uncertain prosperity of the downstream, the future growth space of the company is worth looking forward to.
Investment suggestion: we expect the net profit attributable to the parent company from 2021 to 2023 to be 1.991 billion yuan, 2.706 billion yuan and 3.541 billion yuan respectively. The current share price corresponds to 49x / 37x / 28x PE from 2021 to 2023. Combined with the leading position and excellent governance ability of the company, 45 times PE will be given in 2022. The company’s EPS in 2022 is 2.38 yuan / share, corresponding to the target price of 107.14 yuan. We cover it for the first time and give it a “recommended” rating.
Risk warning: the growth rate of downstream demand slows down; The construction of raised investment projects was less than expected.
