\u3000\u3 Guocheng Mining Co.Ltd(000688) 071 Shanghai W-Ibeda High Tech.Group Co.Ltd(688071) )
Report summary
Deep ploughing powertrain intelligent test, the proportion of new energy business has increased rapidly: since its establishment, the company has continuously developed engine cold test equipment and expanded its business scope to various sub test fields of powertrain. Based on this, the company has launched the test service business of new product R & D and design for downstream customers in recent years, covering the fields of powertrain, automatic driving test and so on. With the development of vehicle electrification, the proportion of new energy powertrain test equipment in the company's test equipment business revenue increased from 4.27% in 2017 to 53.10% in 2021h1. At the same time, the company has gradually accelerated the construction of laboratories, and the number of test stands for testing services continues to increase.
The recovery of automobile production and sales boosted the test demand and benchmarked AVL to become a comprehensive test supplier: according to the data of China Automobile Association, the production and sales of passenger cars in China reached 21.408 million and 21.482 million respectively in 2021, with a year-on-year increase of 7.1% and 6.5% respectively. At the same time, the penetration rate of Shanxi Guoxin Energy Corporation Limited(600617) vehicles increased rapidly, from 5.8% in 2020 to 14.8% in 2021. With the recovery of automobile production and sales and the improvement of new energy penetration, the demand in the field of powertrain testing will be further opened. According to our calculation, the market space of China Shipbuilding Industry Group Power Co.Ltd(600482) assembly test equipment is expected to reach 4.4 billion yuan in 2025. In recent years, Shanghai W-Ibeda High Tech.Group Co.Ltd(688071) and other Chinese manufacturers are gradually replacing AVL and other overseas leaders with the advantages of localization and high efficiency, and moving forward to a leading comprehensive testing supplier.
Test equipment + service resonance, creating IMU's second growth curve: in the field of test equipment, the company has been deeply engaged in cold test technology for many years, and its customers cover joint venture brands such as SAIC GM and GAC Honda, independent manufacturers such as SAIC and FAW, new forces such as Weilai, and Tier1 such as borgwana. In October 2021, the company received a new order of 75 million yuan of testing equipment from Great Wall and Byd Company Limited(002594) supply. In the field of testing services, the company's new energy vehicle powertrain test bench has achieved 18000rpm speed. With the accelerated pace of vehicle launch and steady increase in sales volume of downstream customers, the demand for the company's testing services and testing equipment will be increased respectively. In addition, relying on the engineering test experience, software technology accumulation and the understanding of vehicle data accumulated in long-term cooperation with customers, the company has prospectively arranged the IMU, the core component of inertial navigation system, and jointly developed inertial navigation system with Saic Motor Corporation Limited(600104) Co., Ltd. With the implementation of technology incentive, the company will further expand the market share of talents.
Investment rating: the company's test equipment and services will continue to grow with the launch number and sales volume of downstream customer models, and the forward-looking IMU inertial navigation business will gradually contribute profits. We expect that the company is expected to achieve operating revenue of 321, 505 and 804 million yuan from 2021 to 2023, with a year-on-year increase of 6.22%, 57.43% and 59.17%. The net profit attributable to the parent company was 58 million yuan, 98 million yuan and 175 million yuan, with a year-on-year increase of 38%, 71% and 78%, corresponding to EPS of 0.79, 1.35 and 2.41 yuan. Based on the closing price on March 10, 2022, the current market value of the company is RMB 2.972 billion, corresponding to PE of 51.5x, 30.2x and 17.0x from 2021 to 2023 respectively. The company is given a "buy" rating for the first time.
Risk tips: the risk of decline in customer demand, the business process of IMU is not as expected, the risk of deviation in market space measurement, the slow pace of technical iteration and upgrading, and the risk of untimely update of information and data used in the research report.
