\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 138 Foxconn Industrial Internet Co.Ltd(601138) )
Event overview: on March 22, 2022, the company released its 2021 annual report, realizing an operating revenue of 439557 billion yuan, a year-on-year increase of 1.80%; The net profit attributable to the parent company was 20.01 billion yuan, a year-on-year increase of 14.80%; The net profit deducted from non parent company was 18.581 billion yuan, with a year-on-year increase of 13.39%.
Overcome many adverse effects, increase performance against the trend, and the three main businesses go hand in hand
The company overcame the impact of repeated global epidemics, rising prices of bulk raw materials, tight supply of chips and other important components, achieved positive growth in revenue and accelerated growth in profits against the trend. The gross profit margin of the company was 8.31%, with a year-on-year increase of 0.24pct; The cost structure was continuously optimized, and the sales / management / R & D cost rates were 0.20% / 0.95% / 2.46% respectively, unchanged year-on-year / – 0.10pct / + 0.14pct; The net interest rate was 4.55%, with a year-on-year increase of 0.52pct, and the profitability continued to be optimized.
In the field of communication and mobile network equipment, the annual revenue was 258966 billion yuan, with a year-on-year increase of 1.95%, and the gross profit margin was 10.83%, with a year-on-year increase of 0.34pct. In terms of shipments, the company’s 5g and smart home devices grew strongly in the past 21 years: the shipment of mobile routers exceeded one million sets, and the shipment of WiFi 6 / 6e related products reached 30 million sets; The shipment volume of smart home devices exceeds 100 million, of which the shipment volume of Ott streaming video and audio devices exceeds 60 million, ranking first in the world.
Cloud Computing: the annual revenue was 177694 billion yuan, a year-on-year increase of 1.36%, and the gross profit margin was 4.14%, which was flat year-on-year. The company looks forward to developing a new generation of products, including modular computing and storage units, actively layout edge data centers, drive the development of the company’s autopilot and other products, and promote the mass production and shipment of AI GPU servers and other products.
Industrial Internet: the annual revenue was 1.685 billion yuan, with a year-on-year increase of 16.92%, and the gross profit margin increased significantly by 5.01pct to 43.87%. The company’s “lighthouse factory” model has gone deep into many industries such as electronics, automobile and machinery. At present, it has assisted more than 50 industry leaders to realize digital transformation.
Expand horizontally, accelerate the layout of semiconductors + new energy vehicles + metauniverse, and create the second growth curve
Accelerating semiconductor layout: the company is committed to establishing an Internet Ecosystem of semiconductor industry, improving ODM design capability through investment, focusing on advanced packaging, testing, equipment and materials, EDA software, chip design and other directions.
Promote the lightweight, power-saving and intelligent development of new energy vehicles: the company aims at the three major fields of electric drive, electronic control, intelligent vehicle and vehicle networking, layout core components, integrate upstream and downstream supply chains, and focus on the fields of electric drive, vehicle networking, radar, ACU, control module and industrial Internet.
In the field of metauniverse, strengthen the coordinated development of infrastructure + industry: on the infrastructure side, the company has core advantages in the bottom communication technology (5g + wi-fi6) of metauniverse, and deeply layout the infrastructure, human-computer interaction and decentralization in the seven value chains of metauniverse. On the industrial side, the company uses rich virtual reality and simulation technology to create an “industrial universe” with the construction scheme of “lighthouse factory”.
Pay attention to the return of shareholders and double the dividend per share year-on-year
The company attaches importance to the return of shareholders. In the 21st year, it plans to pay a dividend of 0.50 yuan per share, a year-on-year doubling growth. The profit dividend rate has increased from 28.5% in the past 20 years to 49.5%, and the dividend rate calculated according to the closing price on March 22, 2002 is 4.9%.
Investment suggestion: with the advantages of scale, optimization of revenue structure and cost control, the company’s performance is expected to achieve long-term steady growth, and the current dividend yield is attractive. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 217.33/236.90/26.840 billion respectively, the corresponding PE multiple is 9x / 9x / 8x, and the valuation center of the company since its listing is 16 times. Maintain a “recommended” rating.
Risk warning: the global economy is down; Global epidemic recurrence; Product upgrade iteration is not as expected
