\u3000\u3 Guocheng Mining Co.Ltd(000688) 029 Micro-Tech (Nanjing) Co.Ltd(688029) )
Report guide
The company’s 2021 performance express slightly exceeded our expectations on the revenue side and slightly lower than our expectations on the profit side. We continue to be optimistic about the expansion rhythm of the company’s new visual varieties and overseas channels in 2022. The high growth of the company’s performance in 2022 may continue and maintain the “overweight” rating.
Key investment points
In 2021, the revenue side is slightly higher than expected, and the profit side is slightly lower than expected
In 2021, the company realized an operating revenue of 1.95 billion yuan (YoY 46.8%), a net profit attributable to the parent company of 330 million yuan (YoY 26.7%), and a deduction of non net profit of 280 million yuan (YoY 32.3%). In 2021q4, the revenue was 560 million yuan (yoy41.2%), the net profit attributable to the parent company was 82 million yuan (yoy56.6%), and the non net profit deducted was 73 million yuan (yoy42.3%). The net profit attributable to the parent company in 2021 was slightly lower than our previous forecast, and the operating income was slightly higher than expected.
The net profit attributable to the parent company in 2021 is expected to be slightly lower, which is expected to be mainly affected by three aspects: ① freight increase: affected by the epidemic, the overseas freight, especially the American freight, increased significantly in the second half of 2021 and the transportation time is unstable. In the early stage, in order to ensure that the terminal is not out of stock, some products or even air transportation, the transportation cost may increase slightly. We expect that with the company’s gradual adjustment of inventory and stock rhythm, it will be greatly improved in 2022; ② Increased R & D Investment: in 2021, the R & D investment was about 150 million yuan, an increase of 54.60% over the same period last year, and the R & D expense rate increased from 7.5% in 2020 to 7.9% in 2021. It is expected that this is mainly due to the company’s increased investment in new visualization products. Among them, disposable choledochoscope was approved in November 2021. We expect this product to become another popular single product after “harmony clip” and “golden knife” in 2022. ③ Exchange impact: in 2021, the exchange loss of the company due to the exchange rate fluctuation of euro and US dollar was about 25.45 million yuan, an increase of about 6.8 million yuan over the previous year.
The clinical promotion of disposable choledochoscope is smooth, and it is expected to bring a large increment in 2022
Before the company’s one-time choledochoscope was listed, it has successively carried out clinical trials in key hospitals across the country. In 2021, there may be more than 500 trial hospitals, and a good user reputation has been accumulated. In December 2021, the company’s disposable choledochoscope was officially unveiled at the annual meeting of China digestive endoscopy. At the same time, the “multi center clinical study on the diagnosis and treatment of pancreaticobiliary diseases under direct vision” initiated by the ERCP group of digestive endoscopy branch of Chinese Medical Association was officially launched, and more than 100 clinical units across the country will participate in this study. We believe that compared with traditional ERCP surgery, disposable choledochoscopy has better operability, free from X-rays and academic promotion of multi center clinical research. 2022 may usher in a large-scale stage.
Profit forecast and valuation
Considering that the net profit attributable to the parent company in 2021 is slightly lower than our expectation, we lowered our profit forecast. We expect the company’s EPS to be 2.48, 3.95 and 5.52 yuan / share from 2021 to 2023 (the original EPS was 2.69, 4.05 and 5.78 yuan / share). The closing price on February 25, 2022 corresponds to 39 times of PE in 2022 (28 times of PE in 2023), which is still relatively undervalued and maintains the “overweight” rating.
Risk tips
The volatility of the impact of equity incentive on apparent performance, the risk of decline in gross profit margin, the risk that the sales of new products are less than expected, exchange risk, etc.
