\u3000\u3 Shengda Resources Co.Ltd(000603) 267 Beijing Yuanliu Hongyuan Electronic Technology Co.Ltd(603267) )
Event: Beijing Yuanliu Hongyuan Electronic Technology Co.Ltd(603267) released the 2021 annual report, and achieved an operating revenue of 2.403 billion yuan in 2021, a year-on-year increase of + 41.4%; The net profit attributable to the parent company was 827 million yuan, a year-on-year increase of + 70.1%; Deduct the net profit not attributable to the parent company of 812 million yuan, a year-on-year increase of + 72.5%. With the increase of net profit and the improvement of sales collection from downstream customers, the net cash flow generated by the company’s operating activities was 530 million yuan, a year-on-year increase of + 247.8%.
The revenue of self-produced business increased by 52.1%, resulting in rapid growth of performance: there is a strong demand for self-produced high reliable ceramic capacitors, filters and agency electronic components. The company’s self-produced business achieved a revenue of 1.35 billion yuan in 2021, a year-on-year increase of + 52.1%; The agency business achieved a revenue of 1.04 billion yuan, a year-on-year increase of + 29.1%. The gross profit margin of the company’s self-produced business was 80.8%, 0.9 percentage points higher than that in 2020; The gross profit margin of agency business was 13.1%, 3.1 percentage points higher than that in 2020, which was mainly due to the higher revenue growth rate of passive electronic components with higher gross profit than that of active electronic components with relatively low gross profit margin. The gross profit margin of self-produced business is stable, the proportion of revenue is increased, and the increase of gross profit margin of agency business has led to the improvement of the company’s overall profit margin and rapid growth of performance. The overall gross profit margin in 2021 was 51.5%, 4.8 percentage points higher than that in 2020.
During the period, the expense rate decreased and continued to increase R & D Investment: the company’s sales expense rate and management expense rate in 2021 were 2.9% and 4.1% respectively, down 0.7 and 1.1 percentage points respectively compared with 2020. The R & D expenditure was 80.64 million yuan, a year-on-year increase of + 78.7%, and the R & D expenditure rate was 3.4%, an increase of 0.7 percentage points over 2020, mainly due to the company’s continuous investment in new R & D projects, the expansion of product categories and the improvement of product performance, and the project R & D work carried out after Hongyuan Suzhou was put into operation. The financial expense was 8.94 million yuan, which was the net financial income in the same period last year, due to the increase of interest expense and bill expense and the decrease of interest income. The overall net interest rate in 2021 was 34.4%, 5.8 percentage points higher than that in 2020.
Capacity improvement ensures order delivery, and category expansion is expected to contribute to new growth points: by the end of 2020, some capacity of Hongyuan Suzhou ceramic capacitor production line was put into operation, greatly increasing the company’s ceramic capacitor capacity. The company correspondingly increased the inventory of highly reliable products to ensure order delivery. The output of civil ceramic capacitors increased, the product verification cycle was longer, and the inventory increased. Focusing on the upstream and downstream industrial chain of core products, the company continues to carry out research and development of new products and product series expansion. The income of electronic components such as filters, microwave modules and microprocessors continues to grow, which is expected to contribute to a new growth point of the company’s performance in the future.
Investment suggestion: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 1.16/15.4/1.93 billion respectively, and the corresponding PE of the current stock price is 24 / 18 / 15 times. The downstream demand for highly reliable products is strong, the company’s production capacity is expanded to ensure the supporting capacity in key areas, and expand high-end civil areas at the same time; For the first time, give a “overweight” rating.
Risk warning: the risk that the epidemic will affect the macro-economy and the downstream demand is less than expected; Risks of intensified market competition and falling product prices; The risk that the expansion of civil products market is less than expected.
