\u3000\u3 China Vanke Co.Ltd(000002) 410 Glodon Company Limited(002410) )
[key points of investment]
The company released its 2021 annual report. In 2021, it achieved a total operating revenue of 5.619 billion yuan and an operating revenue of 5.562 billion yuan, a year-on-year increase of 40.92%, slightly exceeding expectations. The annual net profit attributable to the parent company was 661 million yuan, a year-on-year increase of 100.06%, in line with expectations. The non net profit deducted was 651 million yuan, a year-on-year increase of 115.93%; The net operating cash flow was RMB 1.601 billion, a year-on-year decrease of 14.65%. At the end of the reporting period, the balance of cloud contract liabilities was 2.047 billion yuan. After restoring the influencing factors of cloud contract liabilities, the total operating revenue was 6.156 billion yuan, with a year-on-year increase of 33.21%, and the net profit attributable to the parent company after restoration was 1.144 billion yuan, with a year-on-year increase of 29.19%. In the whole year, the sales expenses were 1.587 billion yuan (+ 26.39%), the management expenses were 1.099 billion yuan (+ 25%), and the R & D expenses were 1.333 billion yuan (+ 23.16%). 21q4 achieved a revenue of 2.006 billion yuan in a single quarter, and the net profit attributable to the parent company and net profit deducted in a single quarter were 186 million yuan and 197 million yuan respectively.
Digital cost business is growing rapidly. In 2021, the company’s digital cost business achieved rapid growth, with a revenue of 3.813 billion yuan (+ 36.64%), and after restoring the balance of cloud contract liabilities, the business achieved a revenue of 4.353 billion yuan, a year-on-year increase of + 27.90%. In 2021, the company signed the cloud contract of digital cost business of RMB 3.1 billion (+ 38.77%), and the cloud contract liabilities at the end of the period increased by RMB 537 million compared with the beginning of the year. A total of 2.561 billion yuan of cloud revenue was recognized, accounting for 67.15% of the cost business revenue. The cloud transformation is progressing smoothly. By the end of the year, the conversion rate and renewal rate of the transformation regions had reached a high level from 2017 to 2020. The last four regions that entered the comprehensive cloud transformation in 21 years had achieved positive growth of income after restoration for the first time in the year of transformation. The conversion rate of the new transformation regions exceeded 60% in 2021 and increased in the first year. The gross profit margin of digital cost business was 92.31%, down 1.86pct, mainly due to the growth of e-government business and the corresponding increase in procurement costs.
Digital construction business contract volume. In 2021, the company’s digital construction business achieved a revenue of 1.206 billion yuan, with a year-on-year increase of 27.82%. As the company’s main growth business at present, the newly signed contract amount of digital construction business increased rapidly. In the first half of the year, the company gave priority to expanding contracts, and in the second half of the year, it focused on delivery to ensure revenue and payment collection. By the end of the year, the cumulative number of service projects of project level products had exceeded 55000, and the cumulative number of service customers had exceeded 5000; In 2021, 16000 new projects and 1600 new customers were added. The gross profit margin of construction business was 65.77%, down 6.30pct, mainly affected by the increase of procurement costs.
Rapid expansion of digital design business. The digital design business achieved a revenue of 131 million yuan in 2021, with a rapid year-on-year growth of 250.12%. During the reporting period, the company promoted the rapid expansion of digital design business by increasing marketing and strengthening channel construction. At the same time, it launched bimspace2022 new version and digital architectural design and other products. By the end of 2021, the installed capacity of public beta version of digital architectural design products had exceeded 1700.
[investment suggestions]
The company is a leading digital building platform service provider in China. Both digital cost and digital construction business are on the track of sound development, and the digital design business has burst into growth. With the continuous promotion of digital transformation, the company will continue to consolidate its industry position. Raise the profit forecast of the company from 2022 to 2023, and introduce the profit forecast of the company in 2024. It is estimated that from 2022 to 2024, the company’s operating revenue will be 6.896/8.157/9.521 billion yuan respectively, and the net profit attributable to the parent company will be 9.39/12.24/15 million yuan respectively 0.4 billion yuan, EPS 0.79/1.03/1.26 yuan respectively, corresponding PE 63 / 48 / 39 times respectively, maintaining the “buy” rating
[risk tips]
Downstream prosperity affects demand risk;
The subsequent rate and conversion rate of cost business cloud transformation are lower than the expected risk;
Market competition intensifies risks.
