\u3000\u3 Guocheng Mining Co.Ltd(000688) 092 Hangzhou Iecho Science & Technology Co.Ltd(688092) )
Smart cutting has a high boom and maintains the “buy” rating
The company is a leading enterprise in the field of intelligent cutting in China. We maintain the original profit forecast and add the profit forecast for 2024. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 70, 92 and 123 million yuan, and EPS will be 118, 1.56 and 2.08 yuan / share. The current share price corresponds to 23.4, 17.7 and 13.3 times of PE, maintaining the “buy” rating.
Event: the company released its 2021 annual report and achieved high revenue growth
The company released its 2021 annual report. In 2021, it realized an operating revenue of 319 million yuan, a year-on-year increase of 43.25%; The net profit attributable to the parent company was 53 million yuan, a year-on-year increase of 8.86%. The high growth of the company’s annual revenue is mainly due to: (1) with the increase of intelligent cutting penetration, the demand for the company’s products in the global market continues to grow; (2) Since listing, the company’s raised investment capacity has been gradually released. The growth rate of net profit of the company is lower than that of revenue mainly due to: (1) the rise of unit cost caused by the rise of raw material price, which drags down the comprehensive gross profit margin of products; (2) The company strengthened market promotion and improved the construction of marketing network, resulting in an increase in sales expenses; (3) Affected by the epidemic, the company’s export agency fee increased significantly.
Domestic: it is expected to benefit from the improvement of intelligent cutting penetration and domestic substitution
We believe that the company is expected to continue to benefit from the dual growth logic of intelligent cutting penetration improvement and domestic substitution in the future. With the emergence of new materials, the continuous emergence of personalized and customized needs of end customers and the continuous improvement of cutting process complexity, the penetration rate of intelligent cutting in China is expected to increase. At the same time, the company’s product technology can compete with foreign well-known brands such as France lik, Switzerland Xunte and Belgium ESCO, and is expected to fully enjoy the domestic alternative dividend.
Overseas: with excellent product strength, the revenue is expected to continue to grow at a high level
In 2021, the company’s overseas business realized an operating revenue of 150 million yuan, with a year-on-year increase of 91.87%. The revenue growth rate was higher than that of domestic operating revenue. Overseas sales covered the United States, Russia, Spain, Turkey, Germany and other countries and regions. We believe that the high growth of overseas business highlights the company’s strong technical strength and product manufacturing capacity. Benefiting from the high payment capacity of overseas regions and the continuous polishing of the company’s product strength, the overseas business income is expected to maintain high growth.
Risk warning: the risk of repeated outbreaks at home and abroad and the risk of product research and development falling short of expectations
