\u3000\u3 China Vanke Co.Ltd(000002) 241 Goertek Inc(002241) )
On March 29, Goertek Inc(002241) released the 2021 annual report. The company achieved annual revenue of 78.22 billion yuan, an increase of 35.5% year-on-year; The net profit attributable to the parent company was 4.27 billion yuan, a year-on-year increase of 50.1%; The non net profit deducted was 3.832 billion yuan, a year-on-year increase of 38.9%.
The performance is in line with expectations, and intelligent hardware VR contributes the main increment. Benefiting from the continuous growth of the demand for VR, TWS, smart wearable and other intelligent hardware products and related precision parts and components, the company’s revenue and net profit increased significantly. The company’s 21-year revenue is 78.2 billion yuan, which is in line with our previous expectations for the company. Among them, intelligent hardware increased by + 86% to 32.8 billion yuan year-on-year in 21 years, accounting for 41.9% of + 11pcts. The sharp increase in the proportion is mainly due to the strong demand of Quest 2 in 21 years, which drives the growth of intelligent hardware business performance. The revenue of intelligent acoustic machine was 30.3 billion in 21 years, with a year-on-year increase of 14%. The revenue of precision parts and components was 13.8 billion yuan, a year-on-year increase of 13%. In terms of profitability, the gross profit margin and net profit margin of the company in the whole year of 21 were 14.1% and 5.5% respectively, of which the gross profit margin of intelligent hardware was 13.91%, year-on-year + 1.4pcts; The gross profit margin of intelligent acoustic machine is 10.33%;
The gross profit margin of precision parts and components is 23.11%. The expense rate of the company has narrowed in the past 21 years. Among them, the total expenses of sales, management, R & D and finance amounted to 6.74 billion yuan, and the expenses during the period (Management + sales + Finance) increased from – 1.22 PCTs to 3.27% year-on-year. The company mainly focuses on R & D in VR, AR, optical acoustics and other fields. In the past 22 years, the R & D expenses increased by 21.7% year-on-year to 4.17 billion yuan. The R & D expense rate benefited from the high growth of income, from -0.60pcts to 5.33% year-on-year.
The company expects that the net profit deducted from non parent company Q1 will increase significantly in 2022. The net profit attributable to the parent company in 22q1 is expected to be 869966 million yuan. The company’s non attributable net profit deducted from 22q1 is expected to be 840900 million yuan, with a year-on-year increase of 40% – 50%. The significant increase in the net profit margin of non parent company deduction of 22q1 benefits from the increase in revenue brought by the increase in the shipment of VR, intelligent game consoles and other products, as well as the improvement of the company’s management ability and the continuous optimization of production process.
The VR market continues to boom, the company has deep ar technical reserves, and VR and AR leaders are expected to enjoy track dividends.
According to IDC data, the global volume of VR head display in 2021 was 10.95 million units, breaking the industry inflection point of annual shipment of 10 million units. Among them, oculus Quest 2 has strong sales during the Christmas holiday, and the annual sales volume in 21 years has reached 8.8 million units (more than 10 million units accumulated in the life cycle). VR has made a further breakthrough from end B to end C. According to IDC data, it is expected that the global VR shipment will reach 15.73 million units in 22 years, with a year-on-year increase of about 44%. It is expected that the release of new products such as Quest 2 upgrade and Sony PSVR 2 in 22 years will further expand the demand of the industry. Goer is an ODM leading enterprise in VR industry, deeply binding with VR core brands such as meta, Sony and Pico at home and abroad. The sustainable development of VR industry will drive the company’s performance growth. In the AR field, we expect that in the future, with the gradual increase of the popularity of nano imprint lithography in the AR field, the company will fully benefit from its own technology accumulation and existing nano imprint lithography production lines. In addition, the company’s TWS headphones, Sony’s game consoles and smart wearable products of Chinese customers are expected to bring revenue increment to the company in 2022.
Investment suggestion: we predict that the company will realize a revenue of 106.8/129.4/156.7 billion yuan from 2022 to 2024, a net profit attributable to the parent company of 62.77/96 billion yuan, and a corresponding current price PE of 19 / 15 / 12 Goertek Inc(002241) is the leader of VR and AR in China. Considering the company’s leading advantage in VR track and the potential growth brought by the company’s technology accumulation in AR optical waveguide, it maintains the “recommended” rating.
Risk tip: acoustic innovation slows down, exchange rate fluctuations, industry competition intensifies, and raw material costs rise.
