\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 38 Fibocom Wireless Inc(300638) )
Event overview: on the evening of March 29, 2022, the company released its annual report for 2021. The annual operating revenue was 4.11 billion yuan, a year-on-year increase of + 49.8%, and the net profit attributable to the parent company was 400 million yuan, a year-on-year increase of + 41.5%.
The company's performance grew steadily in 2021, which was in line with expectations as a whole. 1) Revenue side: the company achieved a revenue of 4.11 billion yuan in 2021, a year-on-year increase of + 49.8%, of which Q4 achieved a revenue of 1.26 billion yuan, a year-on-year increase of + 61.8%, mainly due to the high prosperity of the Internet of things industry and the orderly promotion of the company's own business expansion and new product release. 2) Cost side: the gross profit margin of the company in 2021 was 24.10%, and the gross profit margins of Q1 ~ Q4 were 25.11%, 25.89%, 25.05% and 21.25% respectively. The Q4 cost side was under slight pressure, which was mainly caused by the rise in the price of raw materials such as upstream chips. At present, the cost has been gradually transferred to the downstream; The annual sales / management / R & D expense ratio of the company was 15.8%, with a year-on-year decrease of 1.4pcts, and the expense control was continuously optimized; 3) Profit side: the net profit attributable to the parent company in Q4 was 78 million yuan, a year-on-year increase of + 30.51%. Under the pressure of the cost side, the company still maintained steady profit growth.
The Internet of things industry continues to be booming, and the leading module industry is expected to fully benefit. According to iotanalytics data, the number of IOT devices connected worldwide will increase by 9% in 2021, reaching 12.3 billion active terminals. There are now more than 2 billion cellular IOT devices. It is estimated that the number of IOT connections will exceed 27 billion by 2025. CAGR is expected to reach about 21.7% from 2021 to 2025. Meanwhile, according to counter point data, 2021q3 ranked second among the global suppliers of cellular Internet of things modules, with a market share of about 9.6%. We believe that the Internet of things industry will continue to maintain a high outlook in the future, and the company is expected to extend the growth curve by virtue of the subsequent expansion of pen, POS and other fields.
The on-board business is promoted in an orderly manner, with Yuanchi + Ruiling China overseas two wheel drive. According to the data of prospective industry research institute, the penetration rate of China's Internet of vehicles industry will reach 48.8% in 2020, and the number of Internet of vehicles users will be about 140 million. It is expected that the penetration rate of China's Internet of vehicles industry will exceed 75% and the number of users will exceed 380 million in 2025. The company focuses on the field of Internet of vehicles. Guangtong Yuanchi, the main vehicle operator in China, has a good development trend. In 2021, it achieved a revenue of 398 million yuan. Now it has supporting high-quality customers such as Byd Company Limited(002594) , Geely, Chang'an and great wall; At the same time, the acquisition of equity of Ruiling wireless has made steady progress. Ruiling wireless has acquired Sierra's global vehicle module business in 2020 (according to zoth data, Sierra's global share was about 19.1% in 2020, and has mass supplied high-quality Tier1 such as LG Electronics, Marelli and Panasonic, as well as world-famous vehicle manufacturers such as Volkswagen, Peugeot Citroen and Fiat Chrysler). After landing, Ruiling wireless will work with Guangtong Yuanchi in customer resource introduction There is a high degree of complementarity between parts procurement and outsourcing production, and the synergy is worth looking forward to. At the same time, it is expected that Ruiling consolidation will help the company achieve leapfrog growth in business volume and revenue scale.
Investment suggestion: we estimate that the net profit attributable to the parent company in 20222024 will be 6.3/9.4/1.17 billion yuan respectively, corresponding to PE multiples of 25X / 17x / 14x. Quectel Wireless Solutions Co.Ltd(603236) , Meig Smart Technology Co.Ltd(002881) are comparable companies, and the average PE valuation in 22 years is 38x (wind unanimously expected). We believe that the company's traditional pen and POS module business will maintain steady growth, accelerate the integration of Sierra assets, strengthen the layout of vehicle modules, and bring significant performance flexibility. The company is expected to fully benefit from the wave of automotive intelligent Internet connection and achieve rapid growth. Maintain a "recommended" rating.
Risk tip: the competition in the Internet of things industry is intensifying; The development of the Internet of vehicles industry is less than expected.
