\u3000\u3 China Vanke Co.Ltd(000002) 126 Zhejiang Yinlun Machinery Co.Ltd(002126) )
Event: the company released its annual report for 2021. During the reporting period, the revenue reached 7.8 billion yuan, a year-on-year increase of 24%, and the net profit attributable to the parent company was 220 million yuan, a year-on-year decrease of 31%.
1. Rising costs and non recurring profits and losses make the annual profit level lower than expected. The gross profit margin of the company was only 21% in 21 years, down more than 3 points compared with 20 years. The increase of new product investment and cost are the reasons for lowering the gross profit margin of the company. At the same time, the company’s non recurring profit and loss base in 2020 is also high, resulting in a comprehensive profit level in 2021 lower than our previous expectations.
2. The revenue side continues to grow rapidly, and the company’s early business plan is still steadily fulfilled. In the context of the decline in the demand for commercial vehicles, the company has consolidated the base of commercial vehicles, continued to make efforts in the two fields of passenger vehicles and new energy, and the revenue has still exceeded the early-stage business objectives. We believe that at this stage, the scale is still the main growth consideration of yinlun. Continuously increasing the investment in new business and expanding the scale of new business customers will become the key to the growth of the company in the future.
3. New energy thermal management products are growing rapidly. In the past 21 years, the revenue of the company’s new energy thermal management products reached 1 billion yuan, with a year-on-year increase of 223%. The main branch, Shanghai yinlun, achieved a revenue of 890 million yuan, with a year-on-year increase of 133%. The core customers, North American benchmark new energy vehicle enterprises, Chongqing Changan Automobile Company Limited(000625) , new forces of vehicle manufacturing in China, etc., have been in large quantities, and the continuous high growth in the future is still worth looking forward to.
4. The base of commercial vehicles and construction machinery was stable and rose against the trend. In the past 21 years, China’s commercial vehicle and construction machinery market continued to decline, but the company’s commercial vehicle and non road machinery thermal management bucked the trend and increased by 22%. The main core customers Daimler and Cummins continued to increase the company’s procurement efforts, reflecting the stability of the company’s basic business of commercial vehicle thermal management, and has been able to rely on their own growth to resist the risk of industry fluctuation.
Investment strategy: we expect the net profit attributable to the parent company in 22 / 23 to be 420 / 550 million. At present, the stock price corresponds to 16 times of the company’s dynamic PE in 2022, maintaining the company’s “buy” rating.
Risk tip: the sales volume of customers is less than expected, and the popularization of new energy is less than expected.
