\u3000\u3 Guocheng Mining Co.Ltd(000688) 007 Appotronics Corporation Limited(688007) )
Event:
On February 25, 2022, Appotronics Corporation Limited(688007) released the annual performance express of 2021. In 2021, the company realized an operating revenue of 2.506 billion yuan (+ 28.57%); The net profit attributable to the parent company was 222 million yuan (+ 94.96%).
Key investment points:
The revenue of 2021q4 has increased steadily, the profit side is under pressure in the short term, and is optimistic about the improvement of long-term profit. In 2021q4, the company achieved a revenue of 845 million yuan (+ 18.94%) and a net profit attributable to the parent company of 11 million yuan (- 84.78%). 1) Revenue side: the company’s basic business has developed steadily, and the household sector has accelerated efforts to develop new categories of intelligent micro investment to promote revenue growth. During the sub brand fengmi double 11, the whole network Gmv exceeded 200 million yuan, and the sales of tmall Taobao and jd.com in 2021q4 reached 314 million yuan. 2) Profit side: sales, R & D and share expenses increased, and the profit side declined in the short term. C-end market promotion and private brand construction were launched, and the sales expenses of 2021q4 increased by 58 million yuan (+ 114.75%) year-on-year; The R & D efforts of new categories such as laser micro projection and on-board display increased, and the R & D expenses of 2021q4 increased by 23 million yuan (+ 39.70%) year-on-year. Rational use of equity incentive plan and share based payment in the reporting period will have an impact on profits, but will promote new growth in the future.
The company has strong R & D strength, actively expand new products, enrich product matrix and carry out younger brand publicity. 1) R & D: pioneered ALPD laser display technology, with more than 2200 patents, and built industrial technical barriers; 2) Business: in terms of C-end, new products such as fengmi r1nano ultra short focal laser projection, fengmi X1 long focal laser projection and fengmi P1 pocket laser projection meet a variety of scenes and have the advantage of high cost performance. On the B-side, it launched the ALPD laser highlight version of the National Day archives “Changjin Lake” and “me and my parents”, and built large-scale light and shadow exhibitions such as Chongqing Lighting Art season and Shougang Park “Museum of light”, so as to cooperate with Huawei intelligent vehicle solutions to build up the future; 3) Brand: fengmi T1 and Dunhuang culture IP cross-border linkage, with innovative marketing thinking.
As a leader in the laser display industry, the company’s performance grew steadily and was rated “buy” for the first time. The company’s performance has increased significantly. With the improvement of laser display penetration, it is expected to continue to benefit as an industry leader. The field of intelligent micro investment and vehicle may open up a new growth curve and give a “buy” rating for the first time. We predict that the net profit attributable to the parent company from 2021 to 2023 will be RMB 222 / 319 / 460 million, corresponding to EPS of RMB 0.49/0.70/1.02, and the current share price corresponding to PE of 58.50/40.78/28.27 times.
Risk tips: shortage of chip supply, repeated covid-19 epidemic, intensified industry competition, less than expected sales of new products, less than expected development of industry technology, etc.
