Zhejiang Supcon Technology Co.Ltd(688777) (688777)
Event overview
On December 16, Zhejiang Supcon Technology Co.Ltd(688777) announced the 2021 restricted stock incentive plan (Draft) , the number of restricted shares to be granted to the incentive object is 2993500 shares, accounting for about 0.61% of the total share capital of the company on the announcement date of the draft incentive plan of 494084000 shares. This is the first equity incentive plan released after the company’s listing, which aims to attract and retain excellent talents at home and abroad, fully mobilize the enthusiasm of relevant personnel, effectively combine the interests of shareholders, the company and the core team, and firmly promote both internal and external development and top sinking.
The incentive scope covers the company’s core talents at home and abroad, demonstrating the determination to develop both at home and abroad
The total number of incentive objects involved in this incentive plan is 1003, Proportion in the total number of employees of the company (as of November 30, 2021) 20.55% of the 4880 employees, including the company’s senior managers, core backbone personnel and other personnel deemed necessary by the board of directors, including key foreign employees in several core positions. Equity incentive is a common incentive means for overseas companies. The implementation of equity incentive is more stable when China control vigorously develops overseas markets And attract foreign high-end talents to join, promote the construction of the company’s core talent team, and demonstrate the company’s determination to develop both inside and outside the company and actively layout the overseas market.
The company’s performance is robust, fearless of short-term disturbances, and abundant orders on hand, which proves the company’s growth potential
Since the second half of this year, China’s manufacturing industry has been under severe consideration. On the one hand, the price of upstream raw materials has risen, and the production cost of enterprises is under pressure; On the other hand, power and production restrictions affect a wide range, and the operation of enterprises is directly affected. Zhejiang Supcon Technology Co.Ltd(688777) as an intelligent manufacturing service provider for process industry, as of Q3, the revenue was basically flat month on month, various business indicators were stable, and had not been affected by the short-term disturbance of the industry. There are three factors here: first, because the company’s downstream customers are large and close to the upstream of the industrial chain, it has a stronger ability to resist risks such as power and production restriction and price rise of raw materials; Second, because the company has abundant orders on hand and enhanced payment collection ability, the contract liabilities have increased rapidly, increasing by 23.47% over the beginning of the year, with great growth potential in the future; Third, the company has continuously optimized and enriched its project and customer structure, increased the proportion of large projects and large customers, and further strengthened the ability of customer stickiness, business continuity and periodicity of the hedging industry.
The goal of “double carbon” stimulates the upgrading and transformation of high-energy consumption process industry, and the central control makes vigorous preparations
The process industry has high production energy consumption and enlarged pollution emission. All the six high-energy consuming industries in the manufacturing industry come from the process industry. Under the time node target of 2030 carbon peak, the upgrading and transformation will bear the brunt. The main process industry enterprises in the downstream of Zhejiang Supcon Technology Co.Ltd(688777) such as chemical industry, petrochemical industry and electric power are the focus of the upgrading and transformation. Zhejiang Supcon Technology Co.Ltd(688777) for many years, it has been committed to tackling key problems in energy optimization technology and product research and development. Based on the in-depth analysis of the energy management mode and operation characteristics of process industry, the developed energy optimization system and utility optimization system have been applied in nearly 100 process industry enterprises and achieved remarkable energy conservation and emission reduction results. On October 25 this year, the company officially released the white paper on Zhejiang Supcon Technology Co.Ltd(688777) low carbon operation solutions for process industry at the China International Petrochemical conference, detailing the challenges and strategies for the future development of process industry enterprises, so as to provide effective reference for process industry enterprises in the critical period of transformation and upgrading.
Investment advice
The release of the equity incentive plan indicates that central control will continue to firmly promote the development strategy of both internal and external development and top sinking, and make steady and continuous breakthroughs. It is estimated that the company will realize an operating revenue of RMB 4.183/54.93/7.092 billion in 2021 / 22 / 23, with a year-on-year increase of 32.4% / 31.3% / 29.1%. The net profit attributable to the parent company is expected to be RMB 544 / 687 / 892 million, with a year-on-year increase of 28.5% / 26.3% / 29.9%, maintaining the “buy” rating.
Risk statement
1) China’s import substitution and overseas market expansion are less than expected;
2) Product application and promotion and industrial ecological construction are not as expected;
3) The R & D of key core technologies of industrial software fell short of expectations.
