\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 38 Fibocom Wireless Inc(300638) )
Key elements of the report:
On the evening of March 29, 2022, the company released its 2021 annual report, with annual revenue of 4.109 billion yuan (YoY + 49.78%); The net profit attributable to the parent company was 401 million yuan (YoY + 41.51%); Deduct the net profit not attributable to the parent company of 373 million yuan (YoY + 42.72%), and the revenue and profit basically meet the expectations.
Key investment points:
The company’s Q4 performance continued to increase, and the short-term pressure on gross profit margin led to the decline of profit. In a single quarter, in 2021q4, the company achieved an operating revenue of 1.256 billion yuan (YoY + 61.82%, QoQ + 21.71%); Net profit attributable to parent company: 78 million yuan (YoY + 30.51%, qoq-35.16%); Deduct the net profit not attributable to the parent company of 77 million yuan (YoY + 42.65%, qoq-35.37%). The company’s annual gross profit margin in 2021 was 24.10% (yoy-4.21pct), the comprehensive expense ratio (sales + Management + R & D + Finance) was 16.07% (yoy-2.30pct), and the net profit margin was 9.77% (yoy-0.57pct). The gross profit margin of 2021q4 company is only 21.25% (yoy-3.54pct, qoq-3.80pct), which is mainly affected by the shortage of raw materials and the price rise of upstream bulk commodities.
The in-depth layout of the Internet of vehicles market and the continuous development of the on-board module business: in terms of on-board business, the company actively promoted the layout of the Internet of vehicles business. Its wholly-owned subsidiary Guangtong Yuanchi had a revenue of 398 million yuan in 2021, entered the fixed-point list of many car factories, and released a variety of vehicle specification modules, of which 5g vehicle specification module an958-ae won three certificates in a row. Accelerate the landing of 5g, automobile intelligent cockpit and automatic driving application scenarios through upstream and downstream cooperation of the industrial chain. In addition, the company purchased 17% equity of Ruiling wireless held by Jianhua Kaiyuan by paying cash in 2021. After the transaction is completed, the company will develop into the world’s fifth largest supplier of cellular Internet of things modules to provide services for high ASP automotive applications. From the perspective of the vertical segment of the module, the Internet of vehicles is a vertical segment with large market scale and high value. Ruiling wireless is expected to thicken the company’s profits after consolidation in the future and ensure the continuous and accelerated growth of the company’s performance.
Continue to invest heavily in R & D and build a comprehensive product matrix. In 2021, the company’s R & D expenditure was 429 million yuan (YoY + 49.23%), and R & D personnel accounted for more than 60%. High R & D investment also ensured the continuous iteration and market competitiveness of the company’s products. Since 2021, the company has continuously enriched CAT1 and nb-iot products. As the best choice for the low-speed Internet of things after 2G / 3G products are withdrawn from the network, the company’s products are widely used in the Internet of things application fields such as sharing economy, smart meter, smart parking, Jiangsu Nonghua Intelligent Agriculture Technology Co.Ltd(000816) , smart appliances, asset tracking and so on, and successfully won the bid for China United Network Communications Limited(600050) Yanfei CAT1 customized module project. At the same time, in the high-value PC module market, the company has obvious first mover advantage, accounting for more than 50%. With the increasing promotion of downstream laptop manufacturers, the penetration rate of notebook with cellular network will continue to increase, which is expected to further drive the growth of the company’s performance.
Profit forecast and investment suggestions: we believe that under the environment of high-profile Internet of things, the company is expected to maintain high-quality and rapid growth by virtue of high-quality application fields such as card position, laptop and vehicle. We expect that the company’s operating revenue from 2022 to 2024 will be RMB 5.831/79.55/10.748 billion, the corresponding net profit will be RMB 583829/1.107 billion, and the corresponding closing price of PE on March 29 will be RMB 36.70, 26x / 18x / 14x, maintaining the “buy” rating.
Risk factors: intensified competition in the communication module market and shortage of upstream chips or other components.
