\u3000\u3 China Vanke Co.Ltd(000002) 230 Iflytek Co.Ltd(002230) )
Investment summary:
Event: the company disclosed its performance in 2021 and Q1, and the overall performance basically met expectations.
Content:
(1) the growth rate of revenue in 2021 was slightly higher than expected, and the growth rate of net profit attributable to the parent company was slightly lower than expected. The main reason was that a large number of new talent reserves were added, and the net profit after excluding new personnel expenses was much higher than expected, which reflected that the dividend of the company’s just needed base business really realized the accelerated release:
In 2021, the revenue was 18.314 billion (+ 40.6%), with a growth rate far exceeding 30%;
The net profit attributable to the parent company in 2021 was 1.556 billion (+ 14.13%), lower than expected, mainly due to the increase of about 30% of the company’s personnel reserve (3301 people), which increased the relevant R & D expenses by 628 million + sales expenses by 602 million (total R & D expenses + 28.43% to 2.839 billion, total sales expenses + 28.9% to 2.686 billion); Non net profit attributable to parent deduction was 979 million (+ 27.54%);
After excluding personnel expenses, the company’s net profit is much higher than expected. After excluding the R & D and sales expenses of 30% of the newly added personnel and calculating the net profit attributable to the parent according to the effective tax rate of the third quarterly report, we can get the reduced net profit attributable to the parent of about 2.654 billion, a year-on-year increase of about 94.6%, and the reduced net profit deducted from non attributable to the parent of 2.076 billion, a year-on-year increase of 170.6%.
The company’s new personnel are mainly recruited in the second half of 2021. The purpose is to enrich all business lines and make a good reserve of personnel in the future. We believe that this means that the company is optimistic about the future business development and is making positive preparations. Although the company’s net profit is suppressed in the short term, the dividend can be released more obviously after the suspension of personnel recruitment.
(2) in 2022q1, the revenue maintained a high growth rate, and the growth rate of non net profit attributable to parent deduction was the same:
In 2022q1, the company’s revenue was 3.506 billion (+ 40.18%), and the net profit attributable to the parent company was 1.10 (- 21.34%), which was mainly due to the decrease of 154 million in fair value of Cambricon Technologies Corporation Limited(688256) , Three’S Company Media Group Co.Ltd(605168) etc. held by the company due to stock price fluctuations, and the growth rate of 145 million (+ 36.7%) of non net profit attributable to the parent company was basically consistent with the growth rate of revenue.
Viewpoint:
In our opinion, excluding the new personnel reserve in the second half of 2021 and the impact of stock price fluctuations such as Cambricon Technologies Corporation Limited(688256) , Three’S Company Media Group Co.Ltd(605168) and so on, the growth rate of the company’s net profit attributable to the parent company has far exceeded the growth rate of revenue, which has broken the market’s concern about the company’s performance. The just needed base business has led the company through the cycle successfully. Combined with our tracking of the g-end bid winning and C-end sales of the company’s education track in the first quarter, We are optimistic about the company’s annual performance.
Investment strategy:
We increased the revenue from 2022 to 2023 to 27.651/41.251 billion, corresponding to eps1.5 billion 17 / 1.71, 55 times PE, target price 64.35 yuan, optimistic about the company’s annual performance, and the rating was increased to “buy”.
Risk tips: policy risk, market sentiment and risk preference risk, tight government funds, delayed bid winning and landing of g-end business, delayed collection of government funds, C-end sales not meeting expectations, increased R & D personnel and cost investment, reduced government subsidies and other risks.
