\u3000\u3 Shengda Resources Co.Ltd(000603) 596 Bethel Automotive Safety Systems Co.Ltd(603596) )
Key investment points
Key points of announcement: 1) the company released the annual report for 2021, and the performance met our expectations. The annual revenue was 3.492 billion yuan, a year-on-year increase of + 14.81%, and the net profit attributable to the parent company was 505 million yuan, a year-on-year increase of + 9.33%; The net profit deducted from non parent company was 431 million yuan, a year-on-year increase of + 5.77%. Among them, Q4 in 2021 achieved a revenue of 1.164 billion yuan, a year-on-year increase of + 14.48%, a month on month increase of + 47.85%, and a net profit attributable to the parent company of 136 million yuan, a year-on-year increase of – 15.79%, a month on month increase of + 6.40%; The net profit deducted from non parent company was 114 million yuan, with a year-on-year increase of – 18.9% and a month on month increase of + 15.4%; 2) Invest 200 million yuan to acquire 45% equity of Wanda steering system and obtain the control of the board of directors to strengthen the synergy of chassis system; 3) The company issued the financial budget plan for 2022, with a revenue of 4.54 billion yuan and a profit of 608 million yuan.
Core customers promote the high growth of electric braking products in large quantities and actively explore new projects. Chery Automobile, the company’s core customer, achieved an output of 850000 in 2021, a year-on-year increase of + 45.3%, and promoted the company’s electronic brake products to achieve a revenue of 1.275 billion yuan, a year-on-year increase of + 65.4% and a year-on-year increase of + 5.2% in product unit price. In 2021, the company added 160 new projects, including 83 epb83 and 11 brake by wire projects. According to the customer’s planning and calculation, the annual contribution income is nearly 2.5 billion yuan.
The first one box brake by wire production enterprise of Chinese brand, and the new technology continues to be upgraded iteratively. The one box brake by wire system wcbs 1.0 of the company successfully achieved mass production in 2021 and became the first enterprise of Chinese brand to be put into operation. In 2022, based on wcbs 1.0, the company launched the wcbs 2.0 scheme of brake by wire system with braking redundancy function, and carried out the pre research work of electro-mechanical braking (EMB). In the direction of automobile chassis by wire, the development of integrated control such as braking by wire, steering by wire, distributed drive and suspension is carried out step by step. In terms of disc brakes and lightweight products, we will promote the development and promotion of fixed calipers, cast aluminum subframes and cast aluminum calipers, reduce vehicle energy consumption and increase the endurance of new energy vehicles.
Acquire Zhejiang Wanda system and integrate the technical advantages in the chassis field. The company and its related party Ruizhi Lianneng, a subsidiary of Chery technology, jointly acquired 65% equity of Zhejiang Wanda, a primary supplier of steering system. The 100% equity of Wanda system is valued at 446 million yuan, which is about 11.7% higher than the net asset premium and about 26 times the PE. Among them, the company invested 200 million yuan to acquire 45% equity and Ruizhi Lianneng to acquire 20% equity. After the acquisition, the company will obtain the control of the board of directors of Wanda system and include it in the consolidated statements. The settlement of this transaction has yet to be approved by the State Administration of market supervision and administration on business concentration.
Profit forecast and investment rating: in view of the enhanced synergy of the company’s acquisition of Wanda system and the possible continued rise in global bulk material prices and logistics costs, we adjusted the company’s revenue forecast from RMB 4.728/6.213 billion to RMB 4.839/7.010 billion in 20222023 and RMB 9.414 billion in 2024, with a year-on-year increase of + 38.6% / + 44.9% / + 34.3% respectively. The net profit attributable to the parent company from RMB 703 / 9.15 to RMB 666 / 930 million in 20222023, In 2024, it was 1.329 billion yuan, a year-on-year increase of + 32.1% / + 39.6% / + 42.9%, corresponding to EPS of 1.63/2.28/3.25 yuan and PE of 36.41/26.09/18.26 times, maintaining the “buy” rating.
Risk tip: the recovery of passenger car demand is lower than expected, and the penetration rate of new energy vehicles is lower than expected.
