Comments on Glodon Company Limited(002410) annual report: the cost transformation has developed well, and the construction and design have made continuous breakthroughs

\u3000\u3 China Vanke Co.Ltd(000002) 410 Glodon Company Limited(002410) )

Event: in 2021, the company achieved a total operating revenue of 5.619 billion yuan, a year-on-year increase of 40.32%; The operating profit was 758 million yuan, a year-on-year increase of 83.10%; The net profit attributable to the shareholders of the listed company was 661 million yuan, a year-on-year increase of 100.06%.

The transformation of cost business is in-depth, and the sustained and stable growth can be expected. In 2021, the digital cost business realized an operating revenue of 3.813 billion yuan, a year-on-year increase of 36.64%. After the reduction of the balance of liabilities, the adjusted operating income was 4 billion 353 million yuan, up 27.90% from the same year. Cloud contracts signed during the reporting period amounted to 3.1 billion yuan, an increase of 38.77% year-on-year, and cloud contract liabilities at the end of the period amounted to 2.047 billion yuan, an increase of 537 million yuan compared with the beginning of the year. The cloud revenue recognized during the reporting period was 2.561 billion yuan, accounting for 67.15% of the cost business revenue, and the progress of cloud transformation continued to advance. With the deepening of transformation and the improvement of the stickiness of subscription mode, the cost business is expected to achieve stable growth in the future.

The orders of construction business have increased rapidly, and the digital design business has made continuous breakthroughs. The digital construction business realized an operating revenue of 1.206 billion yuan in 2021, with a year-on-year increase of 27.82%; The amount of newly signed contracts has increased rapidly and achieved rapid growth. By the end of 2021, the cumulative number of service projects of digital construction project level products has exceeded 55000, and the cumulative number of service customers has exceeded 5000; In 2021, 16000 new projects and 1600 new customers were added. The digital design business realized an operating revenue of 131 million yuan in 2021, with a year-on-year increase of 250.12%. During the reporting period, the digital design business successfully completed the integration with Hongye Technology, and the power storage design business developed for a long time.

Investment suggestion: we predict that the net profit attributable to the parent company from 2022 to 2024 will be RMB 990, 1.325 and 1.771 billion, EPS will be RMB 0.83, 1.11 and 1.49, and PE will be 59, 44 and 33x, maintaining the "buy" rating of the company.

Risk tip: the progress of cost transformation is less than expected; Construction business demand and order growth were lower than expected; The promotion of new businesses such as design was less than expected.

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