\u3000\u3 Guocheng Mining Co.Ltd(000688) 677 Qingdao Novelbeam Technology Co.Ltd(688677) )
Key investment points
Event: the company issued the share repurchase plan in 2022. It plans to use its own funds of 30-60 million yuan to repurchase the company's shares at a price of no more than 90 yuan / share. It plans to use all of them to implement the employee stock ownership plan or equity incentive. The repurchase period is within 12 months from the date of deliberation and approval of the repurchase plan.
Comments: repurchase of shares under the background of reduction of shareholding shows the management's confidence in the development of the company. As a new endoscope star with underlying technology in China, the company's original ODM business (Stryker) and optical components are expected to grow rapidly in the future. The whole endoscope machine is expected to become the first tier brand in China, and the growth space is expected in the future. However, recently, affected by the reduction of small non holdings, the stock price is under great pressure; The company's share repurchase is used for the future employee stock ownership plan, which shows that the management is full of confidence in the future development of the company.
Strong fundamentals + high cost performance, reducing holdings provides sufficient chips in the medium and long term. Small non holding reduction is a problem that most companies will face when they are listed. We believe that as long as the company's fundamentals are strong enough and the valuation cost performance is high enough, the reduction will only have a certain negative impact in the short term, but it can release liquidity in the medium and long term and provide sufficient chips for investors who are optimistic about the company in the medium and long term, which is also good for the development of the company in the long term Qingdao Novelbeam Technology Co.Ltd(688677) as a rare endoscope manufacturer with core technology in China, its current position has the attribute of strong fundamentals + high valuation and cost performance.
ODM high elasticity + commercialization of the whole machine + speed-up of optical products, three board axe, continue to be optimistic about the growth space of the company.
1) high flexibility of overseas ODM: deeply bind major overseas customers and take advantage of the global volume of Stryker. The company is the global leader in fluorescent hard mirrors (78% share in 2019) and the only optical component supplier of Stryker, with more than 60% revenue from Stryker. After 10 years of cooperation, the company led the implementation of the cutting-edge demand of Stryker endoscopy with underlying technology, took the lead step by step, deeply bound, and exclusively supplied fluorescent endoscopes, light source modules and adapters / adaptive lenses. Since 2022, Stryker has accelerated the structural replacement of white light hard mirrors in the North American market. At the same time, it has explored the Japanese and European markets. The demand for the company's optical components has increased greatly. The orders in 22 years are expected to usher in high growth, and the certainty of high growth in 3-5 years is strong.
2) China's complete machine has been approved for listing and is about to enter a large-scale stage: from upstream ODM / OEM to midstream independent brand complete machine strategy extension, opening up medium and long-term growth space. Large industry β Lay the foundation for high growth of fluorescent hard mirror. From 2019 to 2024, the scale of China's market increased rapidly from 100 million to 3.5 billion, and the development of fluorescent hard mirror in China entered a fast lane. At present, Chinese manufacturers are in the initial stage. Referring to the historical development of endoscopy, Haitai, as the first echelon of domestic production, is expected to significantly benefit from domestic substitution by virtue of its own technical advantages and cooperation with external enterprises such as Sinopharm. The serialization of the company's complete machine products has gradually formed an array. In January 2022, 4K complete machine system was approved. Relying on the advantages of underlying optical technology + Innovation differentiation + CV platform, the complete machine system is expected to become a greater revenue growth point of the company.
3) rapid growth of optical devices: the company widely distributes applications in many fields downstream of Optics and enjoys the growth dividend of optical applications. The company's 20172020 optical products cagr20 7%, which is widely distributed in the fields of in vitro diagnosis, medical cosmetology, industrial laser, biometrics and so on. In 2022, industrial laser, biometrics, dental scanning and other products will increase rapidly, and the annual growth is expected to reach 30%.
Investment suggestion and Valuation: the company deeply binds Stryker with the exclusive supply of optical components. With the acceleration of the substitution of fluorescence for white hard mirror in North America and the market expansion in Japan and Europe, the company has ushered in a historic increase in orders for optical components. It is expected to become a new growth point of the whole machine and vertical system integration company. After the outbreak, new products were put on the market, and the optical device sector resumed rapid volume. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 118 / 174 / 229 million respectively, with a year-on-year increase of 22.2% / 47.4% / 31.7%. The current share price corresponds to a 22 year PE of 36x. Maintain the "buy" rating.
Risk warning: the product R & D registration time is less than the expected risk, the proportion of single customers is too high, the promotion of new products is less than the expected risk, and the market competition intensifies the risk.
