\u3000\u3 Guocheng Mining Co.Ltd(000688) 308 Oke Precision Cutting Tools Co.Ltd(688308) )
Event: on April 12, the company issued the draft restricted stock incentive plan for 2022, which plans to grant 2 million shares to 172 incentive objects, accounting for 2% of the total share capital of the company at the time of announcement; The initial grant price is 28.30 yuan / share.
Core view: we believe that the CNC tool industry is in a special period of accelerating domestic substitution. At this time, the company issued a stock incentive plan to show the management concept of paying attention to R & D and talents. On the one hand, the total number of incentive objects is 172, covering a wide range, which will further improve the company’s long-term incentive mechanism and fully mobilize the enthusiasm of the company’s employees. On the other hand, domestic tool manufacturers have successively expanded production, intensified market competition, and the epidemic situation has repeatedly affected market demand. The company’s increased incentive to R & D personnel will help improve product quality, promote the R & D breakthrough of new products such as cermet tools and integral tools, avoid falling into the trap of price competition, and help the company’s long-term development.
Improve the incentive mechanism, attract and retain talents and show the sincerity of the company
According to the performance evaluation conditions of the equity incentive plan, taking the deduction of non net profit in 2021 as the base, the growth rate of deduction of non net profit in 20222024 shall not be less than 20%, 40% and 60%. The performance evaluation objectives are calculated: the deduction of non net profit in 20222024 will be RMB 235 / 274 / 313 million respectively, with a year-on-year growth rate of 20% / 16.67% / 14.29%, and will maintain steady growth in the next three years. The equity incentive covers a wide range and effectively improves the incentive mechanism of the company. The incentive objects include 172 directors, secretaries, chief financial officers and core technicians, accounting for 19.86% of the total, covering a wide range. The implementation of long-term equity incentive policy is an effective supplement to the existing salary of employees. It will further improve the company’s long-term incentive mechanism, reduce the retention cost, stimulate the motivation of employees, attract and retain excellent industry talents, and give full play to the subjective initiative and creativity of core employees.
Deeply bind core technicians and enhance the company’s core competitiveness
In 2021, the company invested 49 million yuan in R & D, accounting for 4.95% of revenue, and 160 R & D personnel, accounting for 18.48% of the total number. The company has always attached importance to R & D talents. With the rise of domestic knife brands, players in the industry have expanded their production, new players are pouring in, and the talent competition is becoming increasingly fierce. The equity incentive objects include su Zhenhua, Li Shuqiang, Chen Xinge, Luo Lijun, Liu Gang and other key technical personnel, who have more than 15 years of industry experience and have worked in well-known cutting tool enterprises at home and abroad. The deep binding of core technical personnel will help to stabilize the talent team, accelerate talent training, promote technological innovation and R & D progress, continue to maintain and give full play to the company’s advantages in technology and products, and enhance the company’s core competitiveness.
The company is in a critical period of enriching categories and market development. Equity incentives highlight development confidence. The epidemic has repeatedly affected short-term demand, and the uncertainty of macroeconomic environment has increased. With the gradual release of the company’s production capacity, the company is expected to ship hundreds of millions of CNC cutting tools in 2022; According to the announcement, the subsidiary’s CNC Tool Industrial Park can form an annual production capacity of 1000 tons of high-performance bars, 3 million integral cemented carbide tools, 200000 sets of CNC tools, 5 million pieces of cermet blades and 10 tons of cermet serrations, further enriching the company’s product structure. At present, the company is in a critical period of enriching product categories and market development. At this time, the release of the equity incentive plan shows the company’s confidence in development.
Investment suggestion: we expect the company to realize revenue of 1.292 billion yuan, 1.603 billion yuan and 1.941 billion yuan respectively from 2022 to 2024, yoy + 30.45%, 24.06% and 21.08%; The net profit attributable to the parent company is 292 million yuan, 366 million yuan and 446 million yuan, yoy + 31.41%, 25.24% and 21.85%; Corresponding to PE 16.8, 13.4 and 11.0x. The six-month target price is 73 yuan, corresponding to the 25X valuation in 2022, maintaining the investment rating of buy-a.
Domestic products are less than expected, the development process of new markets is less than expected, and the risk of substitution is less than that of the manufacturing industry
