New point software (688232)
The company is a high roe enterprise software leader dressed in the “coat” of government informatization. Founded in 1998, the company has been based on government and enterprise business for many years and has laid out three major information fields. The company takes the Central Research Institute as the basic technology base to improve its product rate level, so as to maintain its competitiveness in the market and lay the foundation for multi business expansion and “non-linear” growth. The company’s ownership structure has advantages to achieve a high degree of consistency between standardized management and employees under the background of state-owned enterprises. In terms of performance, the company’s operating revenue increased rapidly and its profit performance was more brilliant. The company continues to maintain high gross profit margin and net profit margin, and high roe shows excellent operation ability. From the perspective of the company’s business composition, the company’s three major businesses go hand in hand, and the overall business is growing steadily.
The troika of “procurement + government + construction” builds a tog end platform and charges B end in SaaS mode. The company’s core business includes smart recruitment, smart government and digital architecture. Among them, the leading position of smart recruitment business is stable, and SaaS transformation has full potential. As a tog end platform, the business has realized a platform operation revenue of 245 million yuan for the b-end in 2020; The profitability of smart government business is strong, the product ability is prominent, and the overall gross profit margin is more than 70%, higher than that of similar competitors; The smart building business has long-term layout business, synergy and establish market competitive advantage. At present, it is oriented to government customers and enterprise customers to realize the dual layout of government and enterprises. Each of the three businesses maintains rapid growth and can achieve effective collaboration. The smart government platform can drain the smart recruitment platform and drive the b-end business of the platform service to become bigger. Smart bidding business grasps the entrance of civil construction and infrastructure projects, is expected to achieve the integration of “platform pricing calculation” and establish the competitive advantage of digital construction business.
Investment suggestion: the company is a high-quality enterprise deeply engaged in the field of government enterprise informatization. With high profitability, it shows its excellent productization ability and management level. The recruitment business is expected to gradually realize SaaS transformation. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 489 / 649 / 759 million, EPS will be RMB 1.48/1.97/2.30 respectively, and the corresponding PE will be 33x, 25X and 21x respectively. Referring to the company’s business characteristics, we select Linewell Software Co.Ltd(603636) , Wonders Information Co.Ltd(300168) , Neusoft Corporation(600718) with government informatization as the core business as the comparable company. The average PE (wind consensus expectation) of relevant companies in 2021 is 38x, and the average PE (wind consensus expectation) in 2022 is 32x. The company has certain valuation advantages, is covered for the first time, and is rated as “recommended”.
Risk tip: the expansion of products and related businesses is less than expected, and the intensification of industry competition leads to the decline of gross profit margin.
