\u3000\u3000 Lingyi Itech (Guangdong) Company(002600) (002600)
Event:
Lingyi Itech (Guangdong) Company(002600) the 17th meeting of the Fifth Board of directors was held on February 11, 2022 by on-site combined with communication voting. The meeting deliberated and adopted the proposal on signing the cooperation agreement on Guilin Lingyi Itech (Guangdong) Company(002600) intelligent manufacturing project (phase II).
Comments:
On January 11, 2021, the company signed a project cooperation agreement with the Management Committee of Guilin economic and Technological Development Zone in Guilin. The company set up a wholly-owned legal person company in Guilin economic and Technological Development Zone to invest in the construction of Lingyi Itech (Guangdong) Company(002600) intelligent manufacturing project and build ” Lingyi Itech (Guangdong) Company(002600) Intelligent Manufacturing Industrial Park”. The main products are structural parts, and the total investment planned by the company is no less than RMB 1 billion. Guilin Lingyi factory was officially started on December 6, 2021. In order to further improve the company’s business synergy, expand the company’s production base and give full play to the strengths and advantages of both parties, the company plans to sign the cooperation agreement on Guilin Lingyi Itech (Guangdong) Company(002600) intelligent manufacturing project (phase II) with Guilin Municipal People’s Government in Guilin, and the company will invest in the construction of Guilin Lingyi Itech (Guangdong) Company(002600) intelligent manufacturing project (phase II) in Guilin economic and Technological Development Zone, In addition to the previous cooperation, Guilin Municipal People’s government will designate Guilin economic and Technological Development Zone to communicate information with the company and promote cooperation.
The total planned investment of the company is no less than RMB 2 billion, of which about RMB 1.5 billion is invested in fixed assets.
Guilin Municipal People’s Government (Party A) and Lingyi Itech (Guangdong) Company(002600) (Party B) have reached the following cooperation agreement:
(I) cooperation content
1. Project name: Guilin Lingyi Itech (Guangdong) Company(002600) intelligent manufacturing project (phase II)
2. Project cooperation contents and objectives: the project is located in the Huawei cooperation zone of Guilin Economic Development Zone, with a land area of about 500 mu and a total investment of about 6 billion yuan (including about 4 billion yuan for the construction of plant, dormitory and supporting facilities invested by Party A, about 1.5 billion yuan for fixed assets invested by Party B and about 500 million yuan for working capital), and introduces the business of supporting charging modules for consumer electronics, R & D and production of power adapters and chargers for mobile phones, tablet computers and personal electronic products.
3. Project cooperation mode: in the way of “government valuing assets, enterprise neglecting assets and customized construction”, Party A is responsible for investing in the construction of factories and renting them to Party B according to the requirements of Party B, and Party B is responsible for investing in production equipment and organizing production.
4. Project construction requirements: within 6 months from the date when Party B defines the industrial relocation and transfer plan, both parties shall jointly negotiate to determine the specific plant construction content and construction progress, and start the construction.
(II) policy support
Party A shall provide Party B with policy support in the construction of plant and supporting places, rent subsidies, special support, equipment subsidies, logistics subsidies, housing support, export subsidies, etc.
The new energy vehicle business was listed separately in the financial report revenue split, and achieved rapid growth in 21h1. Precision manufacturing products of new energy vehicles are mainly used in EV Batteries, functional materials, precision stamping, body and other products. As important precision components, the shell, cover sector, connector, sealing ring, battery system shell, liquid cooling sector and other components of power battery have a great impact on the performance, service life and safety of battery. With the continuous improvement of the layout and industrial chain of new energy passenger vehicles by traditional automobile enterprises and new market participants, the global and medium Shanxi Guoxin Energy Corporation Limited(600617) passenger vehicle market is expected to maintain a sustained growth trend in the next five years. The gradual expansion of emerging kinetic energy drives the development of new energy power storage battery industry. The continuous volume of global new energy vehicles will continue to drive the rapid growth of the demand for corresponding functional parts and structural parts. Lingyi Itech (Guangdong) Company(002600) in the revenue split of the semi annual report of 2021, the company began to separate the revenue of automobile business. In the first half of 2021, the revenue of this business was about 104 million yuan, a year-on-year increase of 28%. In addition, the company has completed the acquisition of Zhejiang Jintai Electronics Co., Ltd. and announced the investment in the construction of battery structural parts project to vigorously develop the new energy vehicle business.
Earnings forecast, valuation and rating. As the prosperity of smart phone industry is weak, and Lingyi Itech (Guangdong) Company(002600) is in the production expansion cycle, the capacity utilization is in the climbing cycle, and the depreciation cost and labor cost are high, the net profit attributable to parent company of our company from 2021 to 2022 is predicted to be 2.15 billion yuan (- 36.28%), 3.372 billion yuan (- 18.06%), and the original forecast from 2021 to 2022 is 3.374 billion yuan and 4.115 billion yuan; The new net profit attributable to the parent company in 2023 is predicted to be 4.73 billion yuan. At present, the market value of 43 billion yuan corresponds to 20, 13 and 9x PE in 2021-2023.
Lingyi Itech (Guangdong) Company(002600) is committed to becoming a global leader in the whole industrial chain platform of intelligent manufacturing and providing “one-stop” intelligent manufacturing services and solutions for global customers. From basic materials to precision parts and components, to core devices, modules and professional assembly, we can continue to meet the diversified, diverse and immediate needs of customers. The company is one of the few one-stop precision manufacturers in the precision manufacturing industry that simultaneously cover the business of materials, precision functional parts and structural parts, modules and high-quality assembly. Its products are widely used in consumer electronics, new energy vehicles, clean energy, medical treatment, 5g communication, Internet of things and other fields. At present, Lingyi Itech (Guangdong) Company(002600) has actively entered the field of new energy vehicles. The benchmark Luxshare Precision Industry Co.Ltd(002475) 21 / 22 / 23pe is 35x / 26x / 20x and Goertek Inc(002241) 21 / 22 / 23pe is 32x / 24x / 19x. Considering the current low valuation level of Lingyi Itech (Guangdong) Company(002600) , 21 / 22 / 23pe is 20x / 13X / 9x, we maintain the “buy” rating.
Risk tip: there is a downside risk in the prosperity of the consumer electronics industry.
