\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 799 Changzhou Xingyu Automotive Lighting Systems Co.Ltd(601799) )
Matters:
The company released its 2021 annual report. The company achieved a total revenue of 7.91 billion yuan, an increase of 8.0% year-on-year. The net profit attributable to shareholders of listed companies was 950 million yuan, a year-on-year decrease of 18.1%, and the net profit attributable to shareholders of listed companies after deducting non recurring profits and losses was 850 million yuan, a year-on-year decrease of 21.8%. The dividend plan is to distribute a cash dividend of 11 yuan (including tax) for every 10 shares.
Ping An View:
Multiple factors lead to the decline of the company’s gross profit margin and the increase of expenses. The company achieved an operating revenue of 7.91 billion yuan, a year-on-year increase of 8.0%, of which the main business revenue was 7.09 billion yuan, a year-on-year increase of 3.2%. Affected by the epidemic and other factors, the price of raw materials of the company’s products increased, while the labor cost and manufacturing cost increased. The gross profit margin of the company’s main business decreased by 3.1 percentage points to 22.8% compared with 2020. In terms of expenses, the company’s sales and management expenses increased by 21.2% year-on-year in 2021, and the R & D expenses increased by 25.7% year-on-year. When the gross profit margin decreased and the expenses increased, the company’s net profit decreased by 18.1% year-on-year in 2021, reaching 950 million yuan.
The company has sufficient orders for new projects and has benefited from the trend of intelligent lamps for a long time. In 2021, the company undertook the lamp development projects of 62 models, batch produced 42 new models, and undertook new project orders of about 13.5 billion yuan, including ADB headlamp, DLP headlamp and lamp controller. From January 1 to March 15, 2022, the company undertook new project orders of about 4 billion yuan. High quality new project orders provide a strong guarantee for the company. According to the R & D cycle of the lamp industry, The project starts to contribute revenue and profits after 18 ~ 24 months. In addition, with the popularity of LED headlights, the headlights are developing towards ADB, hd-adb, DLP and other functions. The rear combination lamps are developing from separate rear combination lamps to through rear combination lamps. Indoor atmosphere lamps have sprung up and become a new growth point. Automotive exterior atmosphere lamps, such as logo lamps and luminous grids, have gradually become an industry trend. In February 2022, the company signed a strategic cooperation agreement with Huawei to lead the development of intelligent lamps.
The Serbian plant was put into operation in the second quarter of 2022, and the European main engine plant project has entered the batch production stage since 2022. The Serbian plant was started in March 2020 and will be officially put into operation in the second quarter of 2022. The Changzhou Xingyu Automotive Lighting Systems Co.Ltd(601799) Serbian project will enhance the international competitiveness of Xingyu, accelerate the global layout and lay a solid foundation for the development of Changzhou Xingyu Automotive Lighting Systems Co.Ltd(601799) overseas market. In the medium and long term, the Serbian plant will become an important increment for the company to expand its European and even global business
Profit forecast and investment suggestion: as a leading supplier of independent lamps, it will benefit from the development wave of intelligent vehicles for a long time. With the opening of the company’s globalization strategy, it is expected to become an important increment of the company in the future. Considering that the automotive industry will still be affected by the shortage of chips and the rise in the price of upstream raw materials in 2022, We lowered the forecast value of the company’s net profit attributable to the parent company in 2022 / 2023 to 1.261 billion / 1.747 billion respectively (the original forecast value of net profit attributable to the parent company in 2022 / 2023 was 1.832 billion / 2.228 billion), and gave the forecast of net profit attributable to the parent company in 2024 to 2.073 billion yuan for the first time. The company is in a leading position in the field of lamps, overseas projects are promoted orderly, and the medium and long term will benefit from the long-term growth trend of ADB lamps and DLP lamps, Short term core shortage does not change the long-term industry logic and maintain the company’s “recommended” rating.
Risk tips: 1) the problem of chip shortage cannot be solved in time. If the problem of chip supply cannot be solved, it will affect the output of passenger cars and the performance of the company; 2) If the company’s main customers lose or reduce demand, it will have a great impact on the company’s performance; 3) The economic benefits of the company’s projects under construction are less than expected after they are put into operation.
