Securities code: 002230 securities abbreviation: Iflytek Co.Ltd(002230)
Iflytek Co.Ltd(002230) record of investor relations activities
No.: 20210
■ specific object research □ analyst meeting
□ media interview □ performance briefing
Investor relations activities
□ press conference □ Roadshow
Dynamic category
□ site visit
□ others
Cheng Yi of Wells Fargo fund, Xu Yan of Wells Fargo fund, Zhou Ning of Wells Fargo fund, Chen Tianyuan of Wells Fargo fund, Huang Ding of Schroeder of BOCOM, Chen Junhua of Schroeder of BOCOM, Liu Qingxiang of Schroeder of BOCOM, Weng Qisen of Hua’an fund, Chen Jinquan of Xingzheng global, sun ruowei of Xingzheng global, Xie Shuying of Xingzheng global, Lu Shijie of Xingzheng global Names of participating units of Cathay Pacific Foundation: Jin Deng Shifeng, sun Jiaxu of Cathay Pacific Fund, Xu Jingyuan of Ping An pension, Chen of Ping An pension and names of personnel: Xu Shan, LAN Yixiang of Ping An pension, Chen Xiaoguang of Ping An pension, Shao Jinming of Ping An pension, Xia Zhengan of huitianfu, Jiang Yongming of CAITONG asset management, Bao Wen of CAITONG asset management, Deng Fangcheng of CAITONG asset management Haifutong Liu Wenhui, e fund he Yicheng, Bodao fund Zhang Yingjun, Bodao fund Gao Xiaoxiao, chaos investment Qiu Shuxiao, Yuanhao investment Zhang Wei, Yuanhao investment Chai Yifei, Hongshang capital Ouyang fan
Time: February 10, 2022
Location: Shanghai Pudong New Area Shanghai Lujiazui Finance & Trade Zone Development Co.Ltd(600663) financial center
Liu Qingfeng, chairman of the board of directors of the listed company; Jiang Tao, director, senior vice president and Secretary of the board of directors; Names of directors and personnel Nie Xiaolin, senior vice president; Yin Dahai, deputy general manager of iFLYTEK medical, introduced the main contents of the investor relations activity. The participating investors exchanged with Mr. Liu Qingfeng, chairman of the company and the attendees of listed companies on issues related to the company’s business development. The specific minutes of the meeting are as follows: Q: under the background of great financial pressure from the government, iFLYTEK has a lot of business income from tog. In this case, where is the source of iFLYTEK’s continuous growth? A: 1. Some local governments do feel financial pressure. However, we believe that this will not affect the development of iFLYTEK. It can be seen that the whole industry will decline in 2021, but no matter how the environment changes, we will grow. IFLYTEK’s business growth rate is basically 50% in 2022. Our base business insists on meeting the rigid needs of the society and returning to the foundation of value creation, which can go through the economic cycle. 2. In fact, 2021 will be more affected by the change of government. As the change of office leads to the transfer of many decision-making leaders, the new leaders have a cognitive process. If the new leaders do not experience and understand it, it will be bad for our continuous base building in the future. IFLYTEK’s track business now has just needs. Moreover, people’s livelihood expenditures such as education and medical care are guaranteed by the government. For example, the investment of 4% of GDP in education is a hard requirement of the policy. Therefore, iFLYTEK is mainly affected by the change of office in 2021. In addition, due to the repeated epidemic, some local decisions are slow and can not communicate in time. There are also some factors such as the shortage of government funds. In 2021, the business growth related to to to G in all regions did slow down to about 20%. If there is no change of tenure and the impact of the epidemic, it should be able to grow by 40% to 50%.
3. The business directly led by BG still has a very rapid growth. In 2021, the businesses directly led by BG still have a very rapid growth. At the same time, the car, operator and to C businesses grow faster; In 2022, even if the to g business continues to grow by more than 10% or 20%, the company’s overall business can maintain a growth of more than 30%. The company’s to B and to C have formed a good layout, which can hedge the impact of to g to a certain extent. 4. The continuous operation of the base business makes the company’s business growth have the ability of sustainable growth. For example, even if the government is short of funds, the personalized learning manual business will operate normally; As long as there are examinations, mock examinations and cloth examination rooms, we must spend money and so on. Therefore, our b-end itself and C-end form a hedge against g-end, which has formed a good two-wheel drive. 5. On the government side, 2022 is obviously better than 21. The central economic work conference clearly pointed out that in 2022, economic work should be stable and seek progress while maintaining stability, and macro policies should be stable and effective; In mid December 2021, the second comprehensive RRR reduction in the year will be implemented, which will release about 1.2 trillion yuan of long-term funds; At the regular policy briefing of the State Council on December 16, 2021, song Qichao, head of the budget department of the Ministry of Finance and director of the government debt research and evaluation center, said that considering the great pressure of steady growth in the first quarter of next year, the Ministry of finance has recently issued a new special debt limit of 1.46 trillion yuan in 2022 to all localities in advance, promoting the issuance and use of the limit in the first quarter of next year, Provide support for stabilizing the macro-economic market. After the “two sessions” in March 2022, the subsequent amount of about 2.2 trillion will be issued again. According to the notice on reporting the capital demand for new special bond projects in 2022 issued by the Ministry of Finance and the national development and Reform Commission, special bonds in 2022 give priority to projects included in the outline of the national “14th five year plan”, and clarify the key directions of special bonds in 2022, including social undertakings such as health, education, pension and major national strategic projects. On January 21, 2022, Minister of Finance Liu Kun said at the national financial work conference that in 2022, we will actively improve the efficiency of fiscal policy, pay more attention to accuracy and sustainability, maintain appropriate expenditure intensity and improve the accuracy of expenditure. We will vigorously optimize the expenditure structure and focus on supporting key scientific and technological research, basic people’s livelihood, major regional strategies, and major projects in the national 14th five year plan. Many provincial governments insist that the investment in basic people’s livelihood only increases but not decreases, so as to ensure that the proportion of people’s livelihood expenditure is stable at about 80%, such as Shandong, Anhui and other places. Therefore, the government investment in 2022 should be a little better than last year. Judging from the current facts of iFLYTEK, the situation of to G in 2022 is obviously better than that in 21 years. For example, the business of teaching students in accordance with their aptitude in the region will grow by more than 40% in 2021 and the target of 80% in 2022. There is indeed a rigid demand. Education should really be able to solve the problem, otherwise the double reduction required by the general secretary cannot be implemented. For this, iFLYTEK’s regional individualized teaching demonstration based on remarkable application results will hold an on-site meeting.
Second, the government has relevant fixed investment, but the direction of the original investment is not clear enough. “The money used to make soy sauce can’t buy vegetables”, so we can only buy those rigid equipment. Now, because of the double reduction, the demand of layered operation, the integration of software and hardware to teach students according to their aptitude, and so on, these can be in the existing capital disk without additional plans from the government, so that the existing funds can be more reasonably invested in the just needed, and the direction of medical treatment is the same. 6. The state should “release water in a targeted way” to boost GDP. In the next stage, we must support the industrial direction representing the future. The infrastructure investment related to artificial intelligence, the education, medical treatment and the base platform of digital economy transformation we are doing are the main directions of government investment in the next step. In January, the national development and Reform Commission required that the implementation of special bonds in the first quarter of this year should be accelerated and the water should be released accurately. IFLYTEK related businesses are the just demand direction of people’s livelihood required by the state to drive the industry. The advantages of the model we have built will be more fully reflected. The base business of end C and end B will still maintain a benign growth of more than 40% and 50%, and some even 60% and 70% in 2022. For example, the vehicle will increase by 70%, the medical income will double this year, and the gross profit of the contract will double. In fact, we can see this through business opportunities. Generally speaking, in the next few years, the financial factor of sustainable growth will not have a great impact on us. It is precisely because of our base business that we have the ability to cross the economic cycle. Q: I have more confidence in reaching the target of 100 billion revenue by the end of the 14th five year plan. What is the general composition of the target of 100 billion?
A: 1. The main components are expected to be as follows:
Roughly 30 billion in education, 20 billion in medical care and elderly care, 20 billion in open platform + C-end hardware, and 10 billion in automobile business, operators and smart city respectively, of which the endogenous growth of the company’s business accounts for 80%, that is, 80 billion, and the other 20 billion is through ecological M & A and cooperation.
2. What is the proportion of to g, to B and to C businesses in 100 billion hours?
By the end of the 14th five year plan, we think the development process of revenue of 100 billion is as follows:
At 20 billion, the g-end may be 55 ~ 60%, and the C-end may be 40 ~ 45%;
When it reaches 40-50 billion, G and B may be half of the country; At 100 billion, the C-end accounts for 60% to 65%. Q: what is the specific composition of the goal of 30 billion yuan in education business at the end of the 14th five year plan? A: 1. To G’s overall solution for teaching students in accordance with their aptitude for the region. From a business perspective, education is a relatively complex industry. It has the threshold of technology family, needs technological breakthrough and data collection, and also needs to be deeply integrated with the knowledge and methods of education and teaching, with the content of teaching and research resources, Most of the comprehensive solutions for teaching students according to their aptitude that can be seen in the market are made by iFLYTEK. In 2021, more than 20 orders at the prefecture, city and county levels were added. With more and more benchmark application cases in various regions, the demonstration effect has been promoted from single point to region; The goal is to achieve 10 billion yuan during the 14th Five Year Plan period. (1) Is the regional individualized teaching solution sustainable? The construction needs of customers are clear, and the purpose of education policy is to truly improve classroom efficiency and the interaction logic between teachers and students. Before, some places used investment layout projects, but it is often the first entry point. Through application demonstration and verification, the next step will form a benchmark for the project, copy and promote. The Ministry of education requires that we should reduce the burden and increase efficiency, return to the main position of education, make teachers happier, and be able to dynamically evaluate the teaching quality without exams, especially the spirit of relevant documents, and require terminal popularization, etc. Teaching students in accordance with their aptitude has practical needs. For some questions about the sustainability of investment for projects, iFLYTEK has actually been further copied and popularized through demonstration and verification after the investment layout project has formed a benchmark. For example, Anhui Wuhu County and the high tech Zone invested 150-200 million respectively last year, and based on the demonstration and verification, they won the bid in January this year 8.9 billion. Wuhu has a population of two or three million and Bengbu has a population of more than three million. It is estimated that a Wuhu City can reach more than a billion. 2. After the double reduction of to B’s operation services for schools, the demand for layered homework and personalized homework has increased; The goal is to achieve an annual revenue of 5 billion yuan for each volume during the 14th Five Year Plan period; 5 billion in examinations and language learning; (1) After the release of the double reduction policy, will the parental payment model bring policy risks to the individual book business? Each volume is based on the school and paid by parents, which is in line with the trend of double reduction and personalized layered homework; Several groups of indicators show that it is getting better and better: the renewal rate in 21 years has increased from 75% to 90%, and the conversion rate has increased from 58% to 65%; The revenue increased by 63% in 21 years and is expected to increase by 70% in 22 years. (2) The source of 5 billion by the end of the 14th five year plan? Previously, it was mainly distributed in senior high schools. It is estimated that the income scale of senior high schools at the end of the 14th five year plan will be $2.3 billion. Now, after-school training in the stage of compulsory education in junior middle schools needs to be double reduced. Parents have a great demand for personalized after-school services. Based on this, it is estimated that the income of senior high schools will be $5 billion in the 14th five year plan. (3) The source of achieving 5 billion by the end of the 14th five year plan for English examination and language learning? Single subject language learning field, including English listening and speaking test, training, and the college entrance examination are all done by iFLYTEK; In some places of the high school entrance examination, other manufacturers do experiments, and others are iFLYTEK, accounting for more than 90% of the overall market. The annual income of 30 ~ 40 million people in medium-sized provinces can reach 200 million. The mode extends from the examination in the current standardized examination room to daily simulation training and to families in the future. 3. To C terminal for students’ Autonomous Learning
The education system is placed at a high level, and the learning policy is placed at a high level. For example, the State Council’s Document No. 25 of 2021 (the guiding opinions of the development and Reform Commission of the central network and Information Office of the Ministry of education, the Ministry of industry and information technology, the Ministry of Finance and the people’s Bank of China on promoting the construction of new infrastructure for education and building a high-quality education support system) clearly points out that “qualified places should popularize personal learning terminals that meet technical standards and learning needs”, “Develop applications such as intelligent diagnosis, resource push and learning guidance based on big data to promote students’ personalized development. Develop teaching applications such as intelligent teaching assistants and intelligent student partners based on artificial intelligence to realize” man-machine teaching and man-machine education “and improve the quality of education and teaching”. IFLYTEK learning machine is really connected with learning. It has teaching and research content and a complete set of individualized teaching scheme. 22 year learning machine revenue target growth of 200% +; The goal is to achieve an annual income of 10 billion yuan in the 14th five year plan. To sum up, facing the K12 field, recently, the work points of the basic education department of the Ministry of education in 2022 also pointed out that we should highlight the key points, consolidate and improve the “double reduction” level of schools, which is fully consistent with the education business focused by Xunfei: A. improve the level of homework design. On the basis of adhering to the principle of “reducing the total amount and controlling the time”, we should pay more attention to “adjusting the structure and improving the quality”. Promote all schools to improve the pertinence and effectiveness of homework by strengthening the research of homework design. b. Improve after-school service level. On the basis of “full coverage and wide participation”, we should pay more attention to “improving the level and strengthening the guarantee”. Widely select and promote high-quality after-school service resources, promote all localities to further improve the guarantee mechanism of after-school service funds, and ensure that they are implemented County by county and school by school. c. Improve classroom teaching level
