\u3000\u3 China Vanke Co.Ltd(000002) 179 Avic Jonhon Optronic Technology Co.Ltd(002179) )
Event: Recently, the company released its annual report for 2021, which achieved an operating revenue of 12.867 billion yuan, an increase of 24.86% year-on-year; The net profit attributable to the parent company was 1.991 billion yuan, a year-on-year increase of 38.35%; The net profit deducted from non parent company was 1.914 billion yuan, with a year-on-year increase of 38.77%.
The company’s revenue grew steadily and its profitability improved. In terms of product revenue, in 2021, the company’s electrical connector revenue reached 9.555 billion yuan, a year-on-year increase of 23.78%; The revenue of optical devices and photoelectric equipment was 2.600 billion yuan, a year-on-year increase of 22.86%; Fluid, dental and other products achieved a revenue of 712 million yuan, a year-on-year increase of 51.45%. In terms of gross profit margin, the gross profit margin of the company’s electrical connector was 40.99% in 2021, with a year-on-year increase of 0.03pp; The gross profit margin of optical devices and photoelectric equipment was 23.83%, with a year-on-year increase of 4.70pp. The company’s comprehensive gross profit margin increased by 0.97pp year-on-year to 37.00%. In terms of expense ratio, in 2021, the company’s four expense ratio was 19.87%, with a year-on-year increase of 0.31pp. The company’s four expense rates of sales / management / R & D / finance were 2.84% / 6.47% / 10.15% / 0.41% respectively, with a year-on-year increase of -0.34pp / + 0.34pp / + 0.81pp / – 0.51pp respectively. In terms of net interest rate, the company’s net interest rate in 2021 was 16.52%, up 1.66pp year-on-year, a record high.
Inventories and contractual liabilities increased, and the estimated value of related party transactions increased significantly. In terms of inventory, the book value of the company’s inventory was RMB 4.73 billion, an increase of 69.4% compared with the beginning of the period. Among them, the raw materials under the inventory account increased by 65.99% compared with the beginning of the period. In terms of contract liabilities, the company’s contract liabilities were 1.03 billion yuan, an increase of 245.64% over the beginning of the period. The company expects to sell products to related parties with an estimated amount of 2.675 billion yuan, an increase of 37.55% over the actual amount in 2021. The increase of raw materials and contract liabilities may indicate that the company has sufficient orders on hand and is actively preparing goods. The expected value of related party transactions in the next year will increase significantly, or it may indicate that the defense business is expected to rise in 2022.
The connector has broad prospects, and Avic Jonhon Optronic Technology Co.Ltd(002179) is expected to be strong and strong. In the field of defense connectors, considering its technical barriers and the ultimate pursuit of high reliability in the aerospace field, it is difficult for new manufacturers to challenge the industry status of existing manufacturers, and the market competition pattern is stable. Relying on several levels of exploration and high-quality management over the past few decades, the company has firmly occupied the leading position in the industry, and is expected to fully benefit from the large-scale and informatization of downstream weapons and equipment. In the field of 5g communication, the value of connectors in general communication equipment accounts for about 3% – 5%, while in some large equipment, the value accounts for more than 10%. The company has established a good cooperative relationship with the world’s leading 5g equipment manufacturers. Under the background of accelerated 5g construction, the company’s communication related orders are expected to continue to grow, driving the performance to continue to rise. In the field of new energy vehicles, the company’s customers basically cover China’s top ten new energy vehicles, international mainstream new energy vehicle enterprises and battery motor manufacturers, ranking first in the market share of Shanxi Guoxin Energy Corporation Limited(600617) automobile electrical connectors. With the rapid development of new energy vehicle industry, the company is expected to fully enjoy its development dividend.
Profit forecast and investment suggestions: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 2.71 billion yuan, 3.347 billion yuan and 4.016 billion yuan, corresponding to pe33, 26 and 22 times, maintaining the “buy” rating.
Risk tip: the competition in military electronics industry intensifies, defense orders are less than expected, and the growth of civil products market is less than expected
