\u3000\u3 China Vanke Co.Ltd(000002) 152 Grg Banking Equipment Co.Ltd(002152) )
Event: on the evening of March 30, Grg Banking Equipment Co.Ltd(002152) released the annual report of 2021, realizing a revenue of 6.782 billion yuan, a year-on-year increase of 5.79%; The net profit attributable to the parent company was 824 million yuan, a year-on-year increase of 17.68%; The non net profit attributable to the parent company was 716 million yuan, a year-on-year increase of 22.57%; The net cash flow from operating activities was RMB 1.591 billion, with a year-on-year increase of 30.25%.
The performance was stable, the overall net profit was in line with expectations, and the operating cash flow continued to improve. The company achieved a revenue of 6.782 billion yuan in the whole year of 21 years, with a year-on-year increase of 5.79%; The net profit attributable to the parent company was 824 million yuan, a year-on-year increase of 17.68%; The non net profit attributable to the parent company was 716 million yuan, with a year-on-year increase of 22.57%. The overall performance maintained steady growth, and the growth rate of net profit attributable to the parent company was in line with expectations. In terms of profitability, the company's 21-year comprehensive gross profit margin was 39.15%, a slight decrease of about 0.73 percentage points, mainly due to the increase of the proportion of urban intelligent business with relatively low gross profit margin from 35.30% to 37.88%. However, from the perspective of segmented products, the company's software development and service business with the highest gross profit margin (gross profit margin of about 51.04%) has achieved a revenue of 917 million yuan in 21 years, with a year-on-year increase of 36.07%. The rapid growth of software related business is expected to further improve the profitability of the company. The net interest rate of the company in the 21st year was about 12.15%, with a year-on-year increase of about 1.22 percentage points, which mainly benefited from the decline of the company's sales and management expense rate, the decrease of bad debt loss of accounts receivable and the increase of interest income, further reflecting the continuous improvement of the company's operation and management efficiency. In terms of overseas business, the annual revenue was 760 million yuan, with a year-on-year increase of 17.12%. In 22 years, BBVA Bank of Mexico won the financial self-service equipment and maintenance contract of about 176 million yuan, and the overseas market continued to gain. In terms of cash flow, the net cash flow generated by the company's operating activities in 21 years was 1.591 billion yuan, with a year-on-year increase of 30.25%, which continued to maintain a steady growth trend, laying a good cash flow foundation for the company's business development.
Continue to strengthen R & D investment and lay a solid foundation for the development of the company's financial technology and urban intelligent business. The company has invested 773 million yuan in R & D in 21 years, with a year-on-year increase of about 6.62%, accounting for 11.40% of operating revenue; By the end of the 21st century, there were 2140 R & D personnel, with a year-on-year increase of about 29.54%. At present, the company has completed aicore technology base, full plank road information creation solution, digital currency all-in-one machine, digital currency business system platform, bank digital marketing platform and ibank2 2. The research and development of intelligent financial network solutions, smart new police platform, smart access / customer service / government affairs and other solutions, and some products have been applied. We believe that the sustained and stable strong R & D investment and the rapid increase in the scale of R & D personnel further reflect the company's high attention to R & D. strong R & D will lay a solid foundation for the sustainable and stable development of the company's financial technology and urban intelligent business.
With the three-wheel drive of intelligent transformation of bank outlets + financial information innovation + Digital RMB, the financial technology business is expected to maintain stable growth. The company's financial technology business achieved a revenue of 4.213 billion yuan in 21 years, with a year-on-year increase of about 1.57%. In terms of intelligent transformation of bank outlets, it has blossomed in 21 years, successively winning procurement projects such as Sichuan rural credit, Shanxi industrial and commercial bank, Gansu Construction Bank and Shanxi postal savings bank. The smart network construction contract cases have completed the full coverage from state-owned banks, joint-stock banks to urban commercial banks, from hardware monomer contracts to integration contracts, especially the network software business. It has won new breakthroughs in Guangdong Construction Bank, Chongqing postal savings bank, Shanxi postal savings bank, Zhanjiang Agricultural Bank Dongguan agricultural and commercial outlets and other digital operation platform projects, the coverage rate of key banks is far ahead. In terms of financial information innovation, in the past 21 years, the series of financial information innovation intelligent terminal products have been piloted and put into operation in six major state-owned banks and several joint-stock banks; Completed the acquisition of 202446% equity of domestic server manufacturer Wuzhou technology, became its largest shareholder, and further improved the layout of the company's financial, information and innovation industrial chain. In the field of digital RMB, the company has formed a whole industry chain business capability including smart contract, digital RMB payment channel, bank digital currency business system, digital currency Hard Wallet and opening equipment. At present, it has won the bid for the construction project of digital RMB business system of 6 banks, signed a strategic cooperation agreement on digital RMB ecological construction with China Construction Bank Corporation(601939) Hainan Branch of China, and implemented the digital RMB operation project in Hainan. We believe that with the further deepening of the digital transformation of bank outlets and financial information innovation in the past 22 years, as well as the further improvement of the penetration rate of digital RMB in the transformation of banking business system, machinery and equipment and merchant side, the growth rate of the company's financial technology business is expected to be further improved.
Taking advantage of the digital transformation of government and enterprises and new infrastructure, urban intelligent business grew steadily. In 21 years, the company's urban intelligent business achieved a revenue of 2.569 billion yuan, a year-on-year increase of about 13.52%. In terms of digitalization of government and enterprises, the company continued to build products such as urban brain operation, Grg Banking Equipment Co.Ltd(002152) cloud platform, smart state-owned assets / audit big data platform, and announced the establishment of radio and television digital economy investment and Operation Co., Ltd. in January 22 to further increase the resource investment and layout of urban intelligent sector. In terms of smart transportation, the company announced in February 22 that its subsidiary, express intelligence, has completed the introduction of war investment and the shareholding of employee stock ownership platform, raising a total of 94.18 million yuan, further laying a good capital and talent foundation for the development of smart transportation related businesses. We believe that with the further deepening of the digital transformation of government and enterprises and the expectation of "stable growth", the new infrastructure construction is expected to be further accelerated, and the company's urban intelligent business is expected to continue to benefit.
Profit forecast and valuation rating. The company is the leader of China's financial machines and tools, with the market share ranking first in China for 14 consecutive years. With the intelligent transformation of bank outlets and the continuous deepening of information innovation in the financial industry, and the continuous acceleration of the digital RMB pilot, the company's financial technology business is expected to maintain steady growth due to the continuous improvement of the incremental market penetration of the construction of bank currency business system, the upgrading and transformation of financial machines and equipment and the transformation of merchant end; The acceleration of new infrastructure under "steady growth" is expected to bring stable growth space for urban intelligent business. We estimate that the company's operating revenue in 22-24 years will be 7.734 billion yuan, 8.791 billion yuan and 9.949 billion yuan respectively; The net profit attributable to the parent company was 968 million yuan, 1117 million yuan and 1284 million yuan respectively; The P / E ratio is 26.69/23.13/20.12 times respectively; Maintain the "buy" rating.
Risk tips: 1 The intelligent transformation of bank outlets has not progressed as expected; 2. DCEP promotion was not as expected; 3. The promotion of credit innovation in the financial industry is less than expected; 4. The expansion of urban intelligent business is less than expected.
