\u3000\u3 Guocheng Mining Co.Ltd(000688) 187 Zhuzhou Crrc Times Electric Co.Ltd(688187) )
Matters:
The company issued the annual report of 2021. In 2021, the company realized an operating revenue of 15.121 billion yuan, a year-on-year decrease of 5.69%; The net profit attributable to the parent company was 2.018 billion yuan, a year-on-year decrease of 18.49%. It is proposed to distribute a cash dividend of 4.5 yuan (including tax) for every 10 shares.
Ping An View:
Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) business grew rapidly, and the revenue of rail transit business decreased significantly. In 2021, the Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) segment of the company realized a revenue of 2.572 billion yuan, with a year-on-year increase of 35.31%. Among them, the revenue of power semiconductor devices was 1.068 billion yuan, a year-on-year increase of 33.26%; Industrial converter realized a revenue of 528 million yuan, a year-on-year increase of 30.58%; The revenue of electric drive system of new energy vehicles was 456 million yuan, a significant increase of 171.32%. Compared with the rapid growth of Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) business income, the income of the company’s traditional business rail transit equipment sector decreased significantly due to the contraction of national railway investment and other factors. In 2021, the company’s rail transit business realized a revenue of 12.252 billion yuan, a year-on-year decrease of 11.80%, of which the electrical equipment business with the largest proportion decreased by 11.03% and the communication signal business decreased by 54.47%.
The gross profit margin decreased and the proportion of period expenses increased, and the net profit attributable to the parent company decreased significantly compared with the previous year. In 2021, the company’s overall gross profit margin was 33.74%, a decrease of 3.48 percentage points over the same period last year. The market competitiveness of traditional business – rail transit equipment is strong. Although the gross profit margin decreased compared with the same period of the previous year, it is still at a high level. The gross profit margin of this sector in 2021 was 36.99%, down 2.52 percentage points compared with the previous year. Emerging business segments, such as power devices and new energy electric drives, although growing rapidly, have a relatively low gross profit margin, which has dragged down the overall gross profit margin of the company to a certain extent. In 2021, the gross profit margin of the company’s Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) business was 20.05%, a decrease of 2.10 percentage points over the same period of last year. The proportion of period expenses increased compared with the previous year, reaching 23.01% in 2021, an increase of 0.82 percentage points over the same period of the previous year. Under the comprehensive influence of the above factors, the net profit attributable to the parent company decreased significantly compared with the previous year, with a decrease of 18.49%.
It is expected that traditional businesses will resume steady growth momentum and emerging businesses will create greater growth space. Traditional rail transit equipment business is strongly related to national railway mobile equipment bidding and local subway construction investment, and is expected to resume growth in the next few years. According to the requirements of the “14th five year plan” for the development of modern comprehensive transportation system, the operating mileage of National Railways should be increased from 146000 kilometers in 2020 to 165000 kilometers in 2025, with an additional 19000 kilometers. On the one hand, the new line will bring new demand for locomotive electrical equipment, and the company will benefit from it; On the other hand, the replacement of existing locomotives will also create value for the company’s rail transit equipment sector Beijing Emerging Eastern Aviation Equipment Co.Ltd(002933) business, power semiconductor and electric drive business have a large growth space. In 2022, the company’s production capacity of 240000 wafers will begin to climb, which is mainly applied to vehicle specification IGBT. Customers such as Dongfeng and GAC have been identified, and the business of other vehicle enterprises is expanding. In addition, IGBT demand from traditional power grid, photovoltaic and wind power will also tend to be strong.
Investment suggestion: as a leading enterprise in the field of rail transit in China, the company has a relatively leading market position in supporting rail transit equipment. In recent years, the company has achieved remarkable expansion results in emerging fields such as power semiconductors. At the same time, as the leader in the field of high-voltage IGBT in China, the company is complying with the needs of the market, expanding its product coverage market to industries, new energy vehicles, wind power photovoltaic and other fields, and the relevant revenue is growing rapidly. At the same time, as one of the few IDM enterprises in China, IGBT enterprises have benefited more significantly under the background of tight production capacity and accelerated domestic substitution. With the subsequent production of the company’s new production line, the company’s market share in this field will be further improved. Combined with the development of downstream industries and the company’s annual report, we adjusted the company’s profit expectation. It is estimated that the EPS from 2022 to 2024 will be 1.74 yuan (the former value is 1.86 yuan), 2.08 yuan (the former value is 2.26 yuan) and 2.38 yuan (New), corresponding to 33.1x, 27.7x and 24.1x PE on March 29, respectively. Optimistic about the power semiconductor and other emerging tracks where the company is located, and maintain the “recommended” rating.
Risk tips: 1) the market demand is less than expected. 2) The risk of intensified market competition. 3) The progress of technology research and development is less than expected.
