\u3000\u3 Bohai Water Industry Co.Ltd(000605) 117 Ningbo Deye Technology Co.Ltd(605117) )
Photovoltaic inverter industry rookie, multi business to meet high growth
The company is mainly engaged in the R & D, production and sales of heat exchanger products, frequency conversion control chips, photovoltaic inverters and other circuit control products, as well as dehumidifiers, air source heat pump hot air fans and other environmental electrical products. With the rapid development of energy storage market and the rapid growth of photovoltaic installation, the company actively promotes the expansion of inverter business and is expected to become a leading enterprise in China’s household inverter industry in the future. The company is positioned in the household market, the proportion of energy storage business has increased steadily, the gross profit margin is ahead of its peers, and there is good customer and technology synergy between various businesses. We expect that the net profit attributable to the parent company from 2021 to 2023 will be RMB 577 / 919 / 1371 million respectively, and the EPS will be RMB 3.38 / 5.38 / 8.03. The current share price corresponds to pe78.00 9 / 49.6 / 33.2x, covered for the first time and rated “buy”.
The inverter business has developed rapidly, and the multiple advantages of energy storage products have contributed to the growth of revenue
The company’s existing products cover photovoltaic grid connection and energy storage. They are mainly sold to Brazil, South Africa, the United States, India and other countries and regions, with exports accounting for more than 90%. In terms of micro inverter, the company focuses on one to four products. It is expected to launch one to eight products in the industry in 2022, and the product power range is significantly better than that in the same industry; In terms of energy storage, the company focuses on the low-voltage energy storage inverter, which is safer and more reliable than the high-voltage battery system, and can support the application of “intelligent load”, and the off grid automatic switching time is much lower than that in the same industry. The AC coupling function can easily upgrade the existing photovoltaic system, with 6 configurable charge and discharge time periods, and the number of parallel can reach 16. At the beginning of 2022, the company launched high-power 16kw energy storage products for European and American markets, further enriching the product power range.
The business of traditional household appliances has developed steadily, and the market share of the company has increased steadily
As one of the core factors determining the energy efficiency of air conditioning, heat exchanger accounts for about 17% of the cost of air conditioning. With its high production technology, management level and continuous product development ability, the company has been recognized by Midea, oaks and other well-known brand air conditioning manufacturers, and has become the main external supplier of Midea air conditioning. The market share of the company’s heat exchanger business will increase to 9.2% in 2020 and is expected to remain at 10 ~ 15% in the future. The household dehumidifier business is mostly export-oriented, and the channel construction and after-sales service are relatively perfect. In 2020, the market share reached 25.6%. With the improvement of Deye brand reputation and the increase of application scenarios, it can help the company build a leading brand in the high-end environmental appliance industry.
Risk tips: the installed capacity of the industry is less than expected, the risk of epidemic prevention and control, the intensification of overseas market competition, the development of new markets outside China is less than expected, the R & D Progress of inverter products is less than expected, the development risk of OEM mode, etc
