\u3000\u3 Shengda Resources Co.Ltd(000603) 337 Jack Sewing Machine Co.Ltd(603337) )
Event: on April 14, the company released its annual report for 2021, with annual revenue of 6.054 billion, yoy + 71.91%; The net profit attributable to the parent company was 466 million, yoy + 48.67%. In Q4 alone, the company achieved revenue of 1.419 billion, yoy + 47.38%; Net profit attributable to parent company: 130 million, yoy + 72.70%.
Core view: performance meets expectations. In 2021, the demand of the sewing machinery industry continued to pick up. The company fully grasped the opportunity, the production capacity recovered rapidly and reached a new high, and the revenue side and profit side achieved rapid growth. Q4's margin improved significantly in a single quarter. The price rise in the early stage was fully reflected in the statement, and the profitability increased significantly month on month. Looking forward to 2022, the export of sewing machine is expected to be "low in the front and high in the rear", and the export business is worth looking forward to; Intelligent complete sets enter the critical period of market introduction, with broad space and promising prospects.
The performance is in line with expectations, the market share is priority, the strategic results are remarkable, and the market share advantage is obvious
The company's performance is in line with expectations. In 2021, the company achieved rapid growth in both revenue and profit, mainly due to the recovery of demand in the sewing machinery industry. The company fully grasped the opportunity, rapidly increased production capacity, based on the medium and low-end market, expanded the medium and high-end market and achieved rapid growth in sales with the help of product and brand advantages. The company's market share priority strategy has achieved remarkable results. According to the calculation, in the first half of 2021, as the industry leader, the market share of the company among the leading enterprises increased to 38.16%, significantly ahead of Japan heavy machinery (Japan heavy machinery market share 24.61%), the leading position was further consolidated, and the market share advantage was obvious.
Q4 margin improved significantly in a single quarter, and profitability will continue to repair
In 2021, the company's profitability increased steadily, and the effect of lean management was obvious. In 2021, the company achieved a gross profit margin of 24.73%, a year-on-year decrease of 0.44pct, mainly due to the fluctuation of the exchange rate between the US dollar and the RMB, and the gross profit margin of overseas business decreased by 2.45pct; The net interest rate was 7.87%, a year-on-year decrease of 1.09pct. The effect of lean management of the company is obvious. During the whole year, the cost rate is 15.77%, with a year-on-year decrease of 1.57 PCT, of which the sales cost rate is 3.98%, with a year-on-year decrease of 0.87 PCT; The management fee rate was 4.90%, a year-on-year decrease of 1.01pct; The R & D expense ratio was 6.35%, with a year-on-year increase of 0.48pct; The financial expense rate was 0.54%, with a year-on-year decrease of 0.18pct.
In Q4, the gross profit margin was 28.95% (up 7.01pct year-on-year and 2.92pct month on month), and the net profit margin was 9.27% (up 1.59pct year on year and 2.75pct month on month). The marginal improvement was obvious. It is mainly due to the reaction of the price rise in the early stage to the statement. It is expected that Q1 in 2022 will be more fully reflected. Therefore, we judge that the profitability of the company will continue to repair.
Outlook 2022: the export of sewing machine is worth looking forward to, and the export of sewing machine in the critical period of intelligent complete set entering the market is worth looking forward to. Affected by the epidemic situation, the demand of markets outside China is released in staggered peaks, and the current cycle of industrial sewing machines will show a "double peak" state. It is expected that in 2022, the overseas market demand will show a trend of "low before high". Jack Sewing Machine Co.Ltd(603337) as a global leader, it has obvious advantages in production capacity, market share and market response, and the sewing export business is worth looking forward to.
Intelligent complete sets enter the critical period of market introduction. In December 2021, Jack Hangzhou model factory was put into operation. The smooth operation of Hangzhou factory will serve as a benchmark for the company's intelligent complete set business and help open the market. At present, the intelligent complete set business has entered the critical period of market introduction. The company continues to connect with potential customers and has great prospects.
Investment suggestion: we expect the company to achieve revenue of RMB 7.011 billion, RMB 8.424 billion and RMB 10.518 billion respectively from 2022 to 2024, yoy + 15.82%, 20.16% and 24.85%; Net profit of 670, 826 and 1052 million yuan, yoy + 43.62%, 23.32% and 27.32%; Corresponding PE is 13.5, 11.0 and 8.6x; The six-month target price is 30 yuan, which is equivalent to the corresponding 20x valuation in 2022.
Risk tip: the economic growth has fallen sharply, the epidemic has repeatedly affected the demand, and the penetration rate of automatic sewing equipment is lower than expected.
