\u3000\u30 China Baoan Group Co.Ltd(000009) 21 Hisense Home Appliances Group Co.Ltd(000921) )
Event:
The company released its annual report for 2021: in 2021, the company achieved a revenue of 67.56 billion yuan, yoy + 39.6%, a change of + 80.4% over the same period in 19 years; The net profit attributable to the parent company was 970 million yuan, yoy-38.4%, a change of – 45.8% over the same period of 19 years. The sharp decline was due to the operating loss of household air conditioners. Among them, 4q21 achieved a revenue of 17.5 billion yuan, yoy + 29.3%, a change of + 67.5% over the same period of 19 years; The net profit attributable to the parent company was 50 million yuan, yoy-91.9%, a change of – 89.4% compared with the same period in 19 years. Excluding the influence of consolidated three power holdings, the company achieved a revenue of 62.45 billion yuan in 2021, yoy + 29.1%; The net profit attributable to the parent company was 1.128 billion yuan, yoy-28.6%.
Comments:
In 2021, Hisense Hitachi’s revenue increased by + 38% year-on-year, and its net interest rate decreased year-on-year. By region, in 2021, the company’s domestic sales revenue was 37.6 billion yuan (+ 29%), and its export revenue was 23.2 billion yuan (+ 58%). In terms of business, 1) HVAC business: in 2021, the revenue was 30.4 billion yuan (+ 30%), and the revenue of central air conditioning business and household air conditioning business exceeded 20%, of which Hisense Hitachi’s revenue increased by 38%. In terms of central air conditioning, according to the data of Aiken home appliance network, due to the easing of the epidemic and economic recovery, the growth rate of China’s market scale in 1h21 exceeded 35%, and that in 2021 exceeded 25%, of which the proportion of multi online scale rose to 52%; Hisense Hitachi, a subsidiary, had an annual revenue of 18.4 billion yuan (+ 38%), a net profit attributable to the parent company of 2.42 billion yuan and a net interest rate of 13.1% (a year-on-year decrease of 2.9 PCTs). In terms of household air conditioners, according to industry online, in 2021, the domestic / export sales of Hisense air conditioners were – 11% / + 37% year-on-year, and the domestic / export sales of the industry were + 6% / + 11% year-on-year respectively. Among them, the domestic / export sales of 4q21 Hisense air conditioners were + 9% / + 35% year-on-year, and the domestic / export sales of the industry were – 3% / + 5% year-on-year respectively. The company’s business continued the trend that exports were stronger than domestic demand. 2) Ice washing business: in 2021, the company’s ice washing business revenue was yoy + 23%. According to the industry online data, in 2021, the domestic / export sales of Hisense refrigerator were + 7% / + 7% year-on-year, and the domestic / export sales of the industry were – 0.1% / + 5% year-on-year respectively. Among them, the domestic / export sales of 4q21 Hisense refrigerator were – 4% / – 12% year-on-year, and the domestic / export sales of the industry were – 7% / – 6% year-on-year respectively. 3) Other main businesses: in 2021, the company achieved other main business revenue of 7.3 billion yuan (+ 320%), which was mainly caused by the growth of sales volume + consolidated three power companies. If it was based on comparable standards, the company achieved revenue of 2.229 billion yuan (+ 27%).
High raw material costs put pressure on profit margins. In 2021, the company’s gross profit margin was 19.7% (- 4.3pcts), of which the gross profit margin of 4q21 company was yoy-9.6pcts, with a large decline, mainly due to the sharp rise in the cost of upstream raw materials, which squeezed the profit space of various businesses. In 2021, the gross profit margin of HVAC business was yoy-3.7pcts and that of ice washing business was yoy-4.8pcts. Under the pressure of profit, the company’s sales expenses have shrunk, and the annual sales expense ratio is yoy-2.9pcts; Consolidated Table 3: the management scale was expanded due to the electronic control unit, and the annual management fee rate was yoy + 0.7pcts; The company continues to increase the investment in intelligent household appliances, and the R & D expense rate in 2021 is yoy + 0.3pcts. In 2021, the company’s net interest rate was yoy-1.8pcts, of which 4q21 net interest rate was yoy-4.0pcts.
Profit forecast, valuation and rating: Hisense Home Appliances Group Co.Ltd(000921) is the purest central air conditioning target of a shares. The company has completed the acquisition of Sandian holdings and entered the new energy and integrated thermal management system market, which is expected to form a good trend of resource integration, technology sharing and coordination. Considering that the external pressure such as raw materials and shipping has not dissipated, and the consolidated profitability of new businesses is low and still needs time to integrate, we reduced the net profit from 2022 to 2023 to 1.124/1.301 billion yuan (31% / 29% lower than the previous forecast), increased the performance forecast for 2024 to 1.533 billion yuan, and the current price corresponding to PE is 13, 12 and 10 times. In view of the steady profit of Hisense Hitachi, the company’s core asset, we maintained the “overweight” rating.
Risk tip: the price of raw materials rises obviously, the synergy of new businesses is poor, the market competition intensifies, and the risk of exchange rate fluctuation.
