\u3000\u3 Guocheng Mining Co.Ltd(000688) 561 Qi An Xin Technology Group Inc(688561) )
Event: on March 8, the company issued an announcement on the plan of repurchasing the company’s shares by means of centralized bidding transaction.
Repurchase demonstrates confidence in development. Purpose of the shares to be repurchased: all the repurchased shares will be used for employee stock ownership plan or equity incentive at an appropriate time in the future, and will be transferred within three years after the implementation results of share repurchase and announcement of share change are released; If the shares repurchased this time cannot be transferred within three years after the implementation result of share repurchase and the announcement date of share change, the company will perform the procedures of reducing the registered capital according to law, and the non transferred shares will be cancelled; Repurchase period: within 6 months from the date when the board of directors of the company deliberates and approves the repurchase plan; Repurchase price: no more than RMB 80 / share (inclusive); Repurchase amount range: the total repurchase funds shall not be less than 150 million yuan (inclusive) and not more than 300 million yuan (inclusive).
The prosperity of the industry remains the same. The government usually formulates the next year’s budget in the second half of the year and approves the budget in the first half of the year. This year, the government is expected to be relatively loose in finance, focusing on new and old infrastructure. As an industry dominated by government expenditure, network security is expected to take the lead in benefiting. In 2021, the data security law, the regulations on the security protection of key information infrastructure, the personal information protection law and other industrial legislation were successively issued, which opened a huge growth space for the network security market and had a far-reaching impact on the development of the network security industry. The regulatory environment pays more attention to the assessment of “practical” defense effect, driving the transformation of customer demand from “passive compliance” to “active legality”. The catalysis of the conflict between Russia and Ukraine is also expected to increase investment in the network security industry. The company’s products are more capable of practical, systematic and collaborative defense. Its technical competitiveness in the fields of data security and privacy protection, practical situational awareness, cloud security, terminal security, border security, security services and security operations will continue to lead the whole industry and will continue to benefit from the high outlook of the industry.
Customers in important industries maintained a high growth rate. Under the strategy of “high-quality development” and “platform”, the competitiveness of the company’s core products continued to improve, driving the rapid growth of performance, and the growth of revenue in 2021 was nearly 40%. The revenue of customers in key information infrastructure industries such as finance, operators, energy and medical treatment and government customers continued to grow rapidly. In 2021, the company’s revenue growth rate in operators, energy and medical and health industries exceeded 50%; The revenue growth rate of the government and the financial industry exceeded 30%.
Investment suggestion: China is a leader in the field of network security, with continuous R & D and innovation. With a comprehensive product system and strong security service ability, the performance is expected to continue to maintain rapid growth. We estimate that the operating revenue of the company from 2021 to 2023 will be RMB 5.811 billion, RMB 8.135 billion and RMB 11.226 billion respectively, the net profit attributable to the parent company will be RMB -551 million, – 0.54 million and RMB 326 million respectively, and the EPS will be RMB -0.81, – 0.08 and RMB 0.48 respectively. At present, the company has less than 6 times of PS in 2022, the valuation is at a historical low, high growth underestimates the value, and maintains the “buy” rating.
Risk warning: policy promotion is not as expected; Increased competition led to lower than expected product sales
