Han CNC (301200)
Event: the company released its annual report for 2021, and achieved an operating revenue of 4.081 billion yuan in 2021, with a year-on-year increase of 84.62%; The net profit attributable to the parent company was 699 million yuan, a year-on-year increase of 130.21%; The net profit attributable to the parent company was RMB 12.87 billion, a year-on-year increase of 1.96%.
In 2021, the performance maintained a high growth trend and the profitability continued to improve
(1) growth analysis: in 2021, the company’s revenue increased by 84.62% year-on-year, and the net profit attributable to the parent company increased by 130.21% year-on-year. The main reasons are as follows: ① with the upgrading of 5g communication network and the development of big data, emerging applications such as communication equipment, data center, new energy vehicles and consumer electronics will develop rapidly in 2021, driving the rapid growth of demand in PCB industry; ② In 2021, all products of the company ushered in high growth. The number of generators such as drilling equipment and laser direct imaging equipment reached a new high, and the new market share continued to maintain a leading position.
(2) profitability analysis: the gross profit margin of sales in 2021 was 36.35%, with a year-on-year increase of 1.42pct; The net profit margin of sales was 17.11%, with a year-on-year increase of 3.36pct. Mainly because ① the gross profit margin of drilling equipment with high revenue increased; ② The scale advantage is highlighted, and the cost rate is further reduced. During 2021, the expense rate was 17.33%, with a year-on-year decrease of 2.13pct, of which the sales / management / financial expense rates were 6.80%, 10.72% and -0.19% respectively, with a year-on-year decrease of -1.48pct, – 0.38pct and -0.26pct respectively.
(3) analysis of operating capacity and operating cash flow: the company’s operating capacity was further improved. In 2021, the company’s accounts receivable turnover days were 137.79 days, a year-on-year decrease of 21.70 days; The net cash flow from the company’s operating activities reached -244 million yuan, a year-on-year decrease of 378.22%. The net cash flow from operating activities decreased significantly compared with the same period of the previous year, mainly due to the expansion of the company’s revenue scale in 2021, the increase of accounts receivable and the sharp increase of orders on hand, and the corresponding increase in goods preparation.
(4) continue to increase R & D Investment: in 2021, the company’s R & D investment was 265 million yuan, a year-on-year increase of 59.11%, accounting for 6.48% of operating revenue. The continuous improvement of R & D investment will help the company’s products maintain industry-leading advantages.
The PCB product structure is upgraded iteratively, and the equipment demand increases exponentially. With the rapid development of the terminal electronic information industry chain, the demand for high value-added PCB industry continues to rise. In 2000, the proportion of medium and high-end products was only 22.1%, and the relevant proportion is expected to reach 52.48% by 2025. The demand for medium and high-end products such as HDI board, high-rise board and flexible board representing higher technical content is increasing day by day. Taking drilling equipment as an example, it is estimated that under the same output, the input of drilling equipment in HDI production line is 2.16 times and 5.60 times that of high multi-layer board and low multi-layer board respectively. The demand for PCB special equipment represented by drilling equipment shows a geometric growth trend.
Complete product matrix and continuously expand product layout horizontally. After years of development, the company’s products have covered four processes: drilling, exposure, molding and testing. With competitive product matrix and rich sales experience, the company has accumulated rich customer resources. The company’s products have complete processes. At present, it has covered various processes of many leading PCB manufacturers in the world. The synergy also promotes the company to maintain a low level in the cost of developing and maintaining customers. In the future, the company will continue to extend the existing product line horizontally, introduce AOI detection equipment in the detection process, add lamination equipment in the lamination process, and continue to improve the layout of relevant equipment in the physical process.
Extend product application and continue to expand product application fields vertically. At present, multilayer board still occupies the main share in the application field of the company’s products. In the next few years, HDI board and IC packaging substrate will be the PCB products with the fastest composite growth rate, with CAGR of 6.7% and 9.7% respectively. On the basis of deep cultivation of the leading advantages of multilayer boards, the company will vertically extend its products in the application fields of HDI, FPC and IC packaging substrates, and is optimistic about the sustainable growth potential of the company in the future.
Maintain the “overweight” rating. Based on the company’s future product layout and the extension of application fields, we adjust the profit forecast. It is expected that the company’s net profit attributable to the parent company will be 1.078 billion yuan, 1.436 billion yuan and 2.002 billion yuan respectively from 2022 to 2024 (the expected previous value from 2022 to 2023 is 1.004 billion yuan and 1.35 billion yuan); According to the share price on March 30, 2022, the corresponding PE is 22, 16 and 12 times respectively. Maintain the “overweight” rating.
Risk tips: Industry and market competition risk, industrial policy change risk, technology catch-up or replacement risk, overseas dependence of some raw materials and procurement risk of a single supplier, product quality control risk, risk of deterioration of business environment caused by aggravation of covid-19 epidemic.
