\u3000\u30 Jinzai Food Group Co.Ltd(003000) 65 Beijing Highlander Digital Technology Co.Ltd(300065) )
[key points of investment]
The company released the 2021 annual report. The annual operating revenue was 902 million yuan, with a year-on-year increase of 3.61%, the net profit attributable to the parent was 489102 million yuan, with a year-on-year decrease of 14.38%, and the net profit deducted from non attributable to the parent was 141754 million yuan, with a year-on-year decrease of 48.86%, showing a better than expected performance compared with the previous forecast.
The shipbuilding industry bottomed out and recovered, with steady growth in revenue. Benefiting from the long-term recovery of the global ship and sea industry, the company’s orders and handheld orders in the fields of intelligent navigation and ocean observation and exploration have increased significantly, and the overall revenue will continue to grow steadily in 2021. In terms of business, the revenue of the company’s ocean observation detection equipment and system products was 358 million yuan, a year-on-year decrease of 12.63%, and the revenue of intelligent ship and intelligent navigation system products was 468 million yuan, a year-on-year increase of 11.67%.
Short term factors affect the company’s annual profit performance, and the single quarter profit in the fourth quarter hit a record high. In the fourth quarter of last year, the company realized a net profit attributable to the parent company of 396406 million yuan in a single quarter, a record high. The annual net profit attributable to the parent company was 489102 million yuan, a year-on-year decrease of 14.38%, mainly due to the provision of convertible bond interest and equity incentive expenses, totaling 444024 million yuan. After excluding the above factors, the net profit attributable to the parent company increased significantly compared with 2020. We believe that the main reason for the growth is that the gross profit margin of the company’s ocean observation detection equipment and systems, intelligent ships and intelligent navigation systems has rebounded to a certain extent, which promoted the comprehensive gross profit margin to increase by 2.93pct to 33.82% year-on-year in 2021. At the same time, the company’s cost control ability has been improved, and the sales expense rate and management expense rate have decreased to varying degrees.
During the period of technological upgrading and transformation, R & D investment has increased, laying the foundation for growth. In 2021, the company invested 123 million yuan in R & D, with a year-on-year increase of 40.01%. It mainly carried out R & D activities in the fields of microwave navigation radar equipment and shore based radar system, intelligent navigation, ocean observation and detection equipment and UDC, and made breakthroughs in technology and products. The company’s industry has high technical barriers, and the R & D investment continues to increase, which is expected to consolidate the company’s competitive advantage and open up new businesses, The direction of investment is expected to become the growth point of the company’s future performance.
UDC business is good and frequent, and commercialization is imminent. Seabed Data Center (UDC) is the transformation and innovation business currently invested by the company. This business opportunity is based on the company’s long-term technology accumulation in the field of marine engineering and the introduction of relevant foreign teams with Microsoft UDC business experience, so that the company has the ability to implement UDC solutions. At present, after nearly two years of verification and testing, it has officially expanded to comprehensive commercialization. According to the information on the company’s official website, the construction of Hainan phase I project has been officially started, and it is expected to be launched before June 30. In addition, the company recently announced that it had signed a procurement service contract with Singapore company atlas, officially opening the overseas market. UDC scheme has the advantages of energy saving, high efficiency, low cost and low time delay. Under the trend of low-carbon and green, with the continuous improvement of superposition policies and market customer recognition, UDC is about to usher in a great era of vigorous development. As a pioneer of Chinese business, the company is expected to take the lead in benefiting.
[investment suggestions]
The company has officially entered the transformation period of innovative business, and the first phase of the submarine data center project is close to landing. Under the route of global carbon neutralization and carbon peak, the excellent low-carbon green data center solution is expected to be promoted on a large scale. The company has significant first mover advantages in this field, and the relevant revenue is expected to grow rapidly during the 14th Five Year Plan period, bringing important increments to the company’s performance. According to the performance of 2021, we lowered the operating revenue forecast for 20222023, thus lowered the profit forecast, and added the performance forecast for 2024. It is estimated that the operating revenue in 20222024 will be 1.25 billion yuan, 2.395 billion yuan and 3.850 billion yuan, the net profit attributable to the parent company will be 105 million yuan, 243 million yuan and 449 million yuan, and the EPS will be 17 million yuan, 39 million yuan and 71 yuan, corresponding to 81 times, 35 times and 19 times of PE. We are cautious about the future performance of the company, Maintain the “overweight” rating.
[risk tips]
The progress of submarine data center project is less than expected;
The effect of Seabed Data Center after landing is not as expected;
The downstream demand of traditional business is lower than expected;
Core technology and personnel turnover.
