\u3000\u3 Shengda Resources Co.Ltd(000603) 019 Dawning Information Industry Co.Ltd(603019) )
Core view
Event: on April 14, 2022, Dawning Information Industry Co.Ltd(603019) released the annual report of 2021. The annual operating revenue was RMB 11.2 billion, a year-on-year increase of 10.23%, the net profit attributable to the parent company was RMB 1.158 billion, a year-on-year increase of 40.78%, and the non net profit deducted was RMB 773 million, a year-on-year increase of 46.98%. The high increase in the company’s net profit was mainly due to the increase in the company’s gross profit and the increase in the net profit of associated enterprises, which were recognized as investment income. The company plans to distribute cash dividends of RMB 1.60 (including tax) to all shareholders for every 10 shares based on 1.463 billion shares.
Gross profit margin and net profit margin continued to improve, and profitability grew strongly. The gross profit margin of the company has continued to grow for five years, with a gross profit margin of 23.74% in 2021, an increase of 1.61pct over the previous year; The net interest rate was 11.29%, an increase of 2.56pct over the previous year. In 2021, the company’s sales expense rate, management expense rate, R & D expense rate and financial expense rate were 4.5%, 2.2%, 8.6% and – 1.26% respectively, with changes of 0.5%, 0, 1.4 and – 1.4 percentage points respectively compared with the previous year.
The forward-looking layout and advanced calculation are expected to obtain the landing dividend of the policy of “counting from the east to the west”. Relying on the first mover advantage and technical heritage in the field of advanced computing, the company comprehensively arranges the business of Intelligent Computing and green computing. The company’s liquid cooling data center solution can reduce the pue value of computing facilities to 1.04 and reduce energy consumption by 30%; Participate in the construction of integrated computing network hubs in Beijing, Tianjin, Hebei, Chengdu, Chongqing, Gansu and other countries, and lead the demonstration standard of “computing from the east to the west” data center. In addition, the company released the “5A” Intelligent Computing Center Solution to provide practical guarantee and strong support for the construction of local computing power and the prosperity of industrial ecology. At present, the company has participated in the construction of intelligent computing centers in many places.
The deepening of credit innovation policy and the increasing demand for localization inject vitality into the development of the company. 1) The company has developed a variety of high-end computers, including servers and workstations based on domestic processor chips, which have passed the product quality test of national laboratories and achieved mass supply in the fields of finance, securities, communications and so on. 2) In terms of domestic components, the company has completed the design of storage IO modules for the field of cloud computing and artificial intelligence; Based on the open source BIOS and BMC code architecture, the BIOS startup firmware and BMC remote management firmware supporting domestic processors are developed. With the continuous deepening of Xinchuang policy, the company is expected to further expand its business scale.
High R & D investment and continuous expansion of industry coverage. The company has increased R & D investment in intelligent computing, cloud computing and big data. In 2021, the R & D investment of the company was 1.534 billion yuan, accounting for 13.69% of revenue, and 575 new R & D personnel were added. In 2021, the company obtained 90 new patents, and R & D and innovation improved the company’s core competitiveness. In terms of industry coverage, the company has further expanded to education, medical treatment, agriculture, manufacturing and other industries. At the same time, it has further improved its product system, optimized its performance according to customer needs, and continuously expanded its business scale in enterprises, energy, telecommunications, finance and other fields.
Continuous return to investors. Through the profit distribution plan for 2021, the company distributed cash dividends of RMB 160 (including tax) for every 10 shares and RMB 234 million to all shareholders. The company actively rewards investors and highlights the investment value.
Investment suggestion: it is estimated that the company’s revenue from 2022 to 2024 will be RMB 12.096 billion, RMB 13.064 billion and RMB 14.371 billion respectively, with a year-on-year growth rate of 8.0%, 8.0% and 10.0% respectively; The net profit attributable to the parent company was 1.479 billion yuan, 1.897 billion yuan and 2.108 billion yuan respectively, with a year-on-year growth rate of 27.73%, 28.30% and 11.08% respectively. From 2022 to 2024, the EPS was 1.01, 1.30 and 1.44 yuan respectively, and the corresponding PE was 28, 22 and 19 respectively, maintaining the “buy” rating.
Risk warning: market competition intensifies; The R & D of new products is less than expected; The strategic advance is less than expected; Economic downside risk.
