\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 38 Fibocom Wireless Inc(300638) )
Event:
The company released its annual report for 2021, and achieved an operating revenue of 4.109 billion yuan in 2021, with a year-on-year increase of 49.78%; The net profit attributable to the parent company was 401 million yuan, a year-on-year increase of 41.51%; The non net profit attributable to the parent company was 373 million yuan, a year-on-year increase of 42.72%.
Our comments are as follows:
1. The revenue is in line with the expectation, deepen the product & channel layout, and expect high growth in the future
Operating revenue continued to maintain a high growth, (1) the business revenue of wireless communication module was 3.822 billion yuan (YoY + 42.03%). The company continued to deeply cultivate the wireless communication technology of Internet of things and mobile Internet, create a rich product matrix, covering 2G / 3G / 4G / 5G and Nb IOT wireless communication modules and communication solutions based on their industrial applications, and actively released and promoted a number of 4G / 5G new products in 2021 to speed up product deployment. At the same time, the company continues to layout high-quality tracks, such as PC field, Internet of vehicles, mobile payment, etc., conduct in-depth technical exchanges and cooperation with downstream customers, continuously improve sales channels, build and open online shopping malls, and continuously improve market share. (2) Other business income was 288 million yuan (YoY + 443.08%), showing rapid growth.
2. The gross profit margin is under pressure in the short term, and it is expected that the future cost pressure will decrease and the net profit margin will rise under expense control.
On the cost side, the company's gross profit margin in 2021 was 24.10%, down 4.21pct compared with the same period last year. We believe that the main reason is that the price rise of upstream raw materials leads to the increase of cost pressure, and we are actively looking forward to the easing of raw material cost pressure in the future. On the cost side, the company's scale effect is gradually emerging, the cost control is gradually effective, the financial expenses are significantly reduced due to the sharp year-on-year decline of exchange losses, and the three major cost rates of sales / management / finance are declining, The R & D expense rate remains basically the same. The overall net interest rate of the company in 2021 was 9.77%, a slight decrease of 0.57pct compared with the same period last year, and the company is actively looking forward to the recovery of net interest rate after the easing of cost side pressure.
3. The Internet of things market continues to be booming, and the growth momentum of Fibocom Wireless Inc(300638) Nuggets high-quality track is strong
With the rapid growth of connectivity, the golden age of the Internet of things is coming. According to IOT analytics, the number of Internet of things connections has been flat in 2019, and the number of non internet of things connections is expected to increase rapidly at a compound growth rate of 21% in the future. It is expected to reach 12.3 billion active IOT terminals in 2021. In addition, according to China's three-year action plan for the construction of new infrastructure of the Internet of things (20212023), the number of Internet of things connections in China is required to exceed 2 billion by the end of 2023. The Internet of things provides traffic between objects and creates new traffic value. We expect that the application field will continue to expand and the market scale will continue to increase in the future.
Looking forward to the future, the company has laid out high-quality tracks, the industry continues to be prosperous & share expansion, and the growth momentum of performance is strong: 1) the penetration rate of modules in the PC field continues to improve, the company has deep cooperation with Intel, the first mover / market advantage / share is relatively stable, and + 5g products continue to give priority to cards, which is expected to continue to grow in the future; 2) The on-board module benefits from the high prosperity of intelligence and networking, and expands the market outside China through the double line layout of Ruiling wireless + Guangtong Yuanchi. In foreign countries, Sierra wireless has abundant customer resources (Volkswagen Group, FCA, etc.), while accelerating the integration of Sierra from procurement, R & D to marketing and continuously expanding new customers. From the perspective of China: Guangtong Yuanchi has released a variety of vehicle specification level module products and actively built a smart car cabin ecology. Its customers cover Geely, Byd Company Limited(002594) , great wall and other leading car enterprises, and the future will continue to increase the availability; 3) Through continuous and vigorous research and development, the company has continuously enriched the types of IOT products, continuously verified and released new products, and began to vigorously expand the overseas market. In particular, CAT1 products are expected to enter the harvest period and bring significant increment.
Profit forecast and investment suggestions:
The company is the target with strong core competitiveness and sustained and rapid performance growth in the high boom track. Considering the price rise of upstream raw materials, the net profit attributable to the parent company in 22-23 years is adjusted to 560 million and 720 million yuan (the original value is 600 million yuan / 770 million yuan), corresponding to 27x PE in 22 years; Considering Sierra's consolidated statement, it is estimated that the company's pro forma net profit for 22-23 years is 650 million yuan and 840 million yuan (the original value is 670 million yuan / 870 million yuan), corresponding to 23x PE for 22 years, maintaining the "buy" rating.
Risk tip: the sales volume of intelligent Internet connection / new energy vehicles is lower than expected; Fierce competition in the industry and the risk of price decline; The price rise of upstream chips and raw materials affects profitability; The order execution progress is lower than expected, etc
