\u3000\u30 China Baoan Group Co.Ltd(000009) 88 Huagong Tech Company Limited(000988) )
Event overview: on March 29, 2022, the company released the 2021 annual report and 22q1 performance forecast. 1) In 2021, the operating revenue was 10.167 billion yuan, with a year-on-year increase of 65.65%, the net profit attributable to the parent was 761 million yuan, with a year-on-year increase of 38.24%, and the net profit deducted from non attributable to the parent was 544 million yuan, with a year-on-year increase of 53.12%. 2) It is estimated that the net profit attributable to the parent company in 21q1 will reach 200230 million yuan, with a year-on-year increase of 75.88% – 102.27%, and the net profit deducted from the non parent company is expected to reach 182212 million yuan, with a year-on-year increase of 83.95% – 114.27%.
The reform of schools and enterprises has stimulated growth momentum and achieved leapfrog growth in revenue
In 2021, the company completed the school enterprise separation reform, and the actual controller was changed from Huazhong University of science and technology to Wuhan SASAC. The company officially entered a new stage of systematic growth and strategic expansion. The company has formulated a three-year work plan for human resources and launched a long-term incentive mechanism that is result oriented and linked with salary level and business performance. In the past 21 years, the company’s operating income exceeded 10 billion yuan for the first time, the highest level in history, and the reform of schools and enterprises has achieved initial results. The revenue contribution of small base station business is incremental, and the downstream demand for laser / new energy vehicles is strong. In terms of business, 1) the revenue of laser processing and series complete sets of equipment was 2.607 billion yuan, with a year-on-year increase of 38.03%, of which the revenue of intelligent equipment business increased by 38% year-on-year. The new energy vehicle industry made a breakthrough. The laser welding business of battery tray led to the batch sales of cutting, hand-held welding and other products. In the field of automobile body in white welding production line, it successfully won the bid for the automation production line project of Weilai, Byd Company Limited(002594) and other well-known automobile enterprises; The revenue of the precision system business group increased by more than 30% year-on-year, successfully developed the appearance defect detection equipment of mobile phone glass and screen module, actively arranged the semiconductor (wafer detector) and new energy fields (the overall solution of lithium battery industry), developed vertically and explored new business growth points. 2) The revenue of optoelectronic device series products was 5.38 billion yuan, a year-on-year increase of 103.38%, mainly due to the large-scale shipment of joinsite series small base station products from Q2, and the revenue scale increased by 670% year-on-year; The digital communication optical module has entered the Internet of many domestic and foreign enterprises, and the 400g full series products have been delivered in batches; Expand “prism + code disk” in the optical field, and the revenue increased by about 50% year-on-year. 3) The revenue of sensitive components was 1.415 billion yuan, a year-on-year increase of 41.80%. The share of Samsung air conditioning temperature sensor in the field of household appliances increased significantly and extended vertically to the field of kitchen electricity; PTC heaters for new energy vehicles achieved full coverage of main engine plants in China, with sales increasing by 176% year-on-year; The sales of automobile temperature sensors increased by more than 47% year-on-year, and further expanded to the field of charging piles, batteries and motors of new energy vehicles. 4) laser holographic anti-counterfeiting products revenue was 489 million yuan, up 14.17% over the same period last year. The company is monitoring the opportunity of tobacco packaging and replacing Baijiu, breaking through many liquor brands and expanding the surface decoration market of plastics.
The gross profit margin decreased month on month, and the provision for expenses and impairment losses resulted in negative Q4 profit, and the performance of 22q1 improved significantly
The revenue of 21q4 in a single quarter was 2.798 billion yuan, with a year-on-year increase of 71.98%, and the net profit attributable to the parent company was -40.68 million yuan. The performance decline was mainly due to the rise in the price of raw materials and the change of product structure. The gross profit margin in a single quarter decreased by 2.43pct to 14.79% month on month. At the same time, due to the centralized provision of equity incentive expenses, restructuring expenses and special bonuses for employees, the management expenses of 21q4 increased by 131 million yuan month on month, which also affected the profitability. The company’s performance in 22q1 greatly exceeded the market expectation, and the net profit attributable to the parent company is expected to be 200230 million yuan, with a year-on-year increase of 75.88% – 102.27%. We believe that on the one hand, it is due to the strong demand for business such as revenue end laser equipment and new energy vehicle PTC, on the other hand, the completion of the construction of raised investment projects in 21 years, the improvement of lean production capacity, the increase of the proportion of high-end product shipments, and the significant improvement of Q1 profitability.
Investment suggestion: the company’s school enterprise restructuring in the past 21 years has achieved initial results. Looking forward to the future, the endogenous kinetic energy is sufficient. We expect the net profit attributable to the parent company in the past 22-24 years to be 1.12 billion / 1.525 billion / 2.004 billion respectively, corresponding to 19 times / 14 times / 11 times PE, and 46 times the valuation center of the company in the past five years. Maintain a “recommended” rating.
Risk warning: market competition intensifies and downstream demand is less than expected
