\u3000\u3 China Vanke Co.Ltd(000002) 415 Hangzhou Hikvision Digital Technology Co.Ltd(002415) )
Matters:
The company released its annual report for 2021. In 2021, the company achieved a revenue of 81.42 billion yuan (28.21% YoY) and a net profit of 16.8 billion yuan (25.51% YoY) attributable to shareholders of listed companies. Distribute a cash dividend of 9 yuan (including tax) for every 10 shares to all shareholders.
Ping An View:
The performance is in line with expectations and the performance of innovative business is beautiful: in 2021, the company achieved revenue of 81.420 billion yuan (28.21% YoY) and net profit attributable to shareholders of listed companies of 16.8 billion yuan (25.51% YoY). In 2021, the company’s overall gross profit margin and net profit margin were 44.33% (- 2.2pct YoY) and 21.51% (- 0.03pct YoY) respectively, and the company’s performance met expectations. The company’s main businesses are divided according to domestic, overseas and Innovation: 1) domestic business: PBG revenue of public service group was 19.161 billion yuan, a year-on-year increase of 19.85%; The revenue of EBG of enterprises and institutions was 16.629 billion yuan, a year-on-year increase of 12.94%; SMBG revenue of small and medium-sized enterprise business group was 13.49 billion yuan, a year-on-year increase of 46.49%.
In 2021, under the background of complex international environment, the revenue of the company’s three business groups was also relatively stable, while the SMBG business group recovered significantly after the epidemic in 2020. 2) Overseas business: the company’s overseas revenue was 18.926 billion yuan, a year-on-year increase of 15.09%. By the end of 2021, the company had set up 66 branches in the international, Hong Kong, Macao and Taiwan regions to provide localization services for more than 150 regions. 3) Beautiful performance of innovative business: at present, the innovative business camp includes fluorite network, Haikang Siasun Robot&Automation Co.Ltd(300024) , Haikang micro shadow, Haikang automotive electronics, Haikang storage, Haikang fire fighting, Haikang Ruiying, Haikang Huiying, etc. (including smart home, Siasun Robot&Automation Co.Ltd(300024) , thermal imaging, automotive electronics and other products). The company’s accumulated technical reserves and growing business tentacles provided a good soil for innovative business development. The company’s innovative business revenue was 12.271 billion yuan, a year-on-year increase of 98.93%. Expense side: in 2021, the company’s financial expense rate, sales expense rate, management expense rate and R & D expense rate are – 0.16% (- 0.78pct YoY), 10.55% (- 1.07pct YoY), 2.62% (- 0.20pctyoy) and 10.13% (+ 0.09pct YoY) respectively. In terms of hardware products, the company continues to strengthen the research of perception technology and continue to improve the design ability of product system; Relying on AI, cloud computing and other technologies, upgrade product package solutions and create comprehensive competitiveness of products
Strengthen technological innovation, open the ecological enabling system and fully form: technological innovation is the most important business means for the survival and development of the company. In order to meet various challenges and new opportunities, from 2017 to 2021, Hangzhou Hikvision Digital Technology Co.Ltd(002415) the proportion of R & D in revenue was 7.62%, 8.99%, 9.51%, 10.04% and 10.13% respectively, and the proportion of R & D investment increased year by year. At the same time, the company has accelerated the expansion to big data business and the development of innovative business. In order to meet the challenges, it has also started the spin off and listing of fluorite network (fluorite network has submitted an IPO application). The company can provide comprehensive opening-up capabilities including equipment, platform, data and applications, and provide all-round support for industry application developers. The company’s integrated operation and maintenance service platform provides equipment probes to support the access of third-party sensing devices; In addition, the material information fusion data resource platform supports access to the third-party data storage management system or data format while providing the mainstream data access mode; The IOT data governance tool provided supports element governance and point layout evaluation of multi vendor and multi type IOT equipment; The data service interface provides support for the development of business applications.
AI leads the intelligent transformation of security, and the company continues to promote the development of innovative business: under the trend of intelligent upgrading of security, the core competitiveness of the industry is gradually transformed into the landing ability of technical architecture and solutions. Enterprises with deep technical strength will keep pace with the industrial transformation, small companies with weak technical investment will be further eliminated, and the industrial threshold will be raised, so that the industrial concentration is expected to be further improved, The industry structure has been continuously optimized. At the same time, with the development of artificial intelligence technology and the processing technology of video image by computer, the utilization efficiency of video monitoring and the utilization of big data value will be greatly increased, and the function of camera image acquisition will no longer be limited to the purpose of security. Therefore, “Ai + security” not only helps customers improve business efficiency, but also greatly expands the market space for video technology to meet the needs of business management. In the context of data being the king, the company has a huge amount of data resources and will have an absolute natural advantage in the intelligent reform of security. In addition, the company has made profits in fluorite business and Haikang Siasun Robot&Automation Co.Ltd(300024) business, and other innovative businesses such as Haikang automotive electronics and Haikang storage have invested and promoted the target market, which is expected to form a joint force with the main business in the future.
Investment suggestion: the company is the world’s leading provider of security monitoring products and content services. The products and services have achieved full coverage of all major equipment of the video monitoring system; At the same time, the company’s overseas market expansion is moving forward steadily, and the innovative business is getting better and better, which will add impetus to the steady growth of performance. We maintain the company’s 22 / 23 year profit forecast unchanged and add a 24 year profit forecast. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 201.53/237.24/27.918 billion respectively, corresponding to 19 / 16 / 14 times of PE, maintaining the “recommended” rating of the company.
Risk tips: 1) technology replacement risk: with the continuous evolution of cloud computing, big data, artificial intelligence and other technologies, the business and application requirements of the industry may evolve accordingly. If we can’t closely track the updates and changes of cutting-edge technologies in the industry, the uncertainty of the company’s future development will increase; 2) Exchange rate fluctuation risk: the company operates in many countries and regions with different currencies in the overseas market. The exchange rate risk mainly comes from the foreign currency exposure and exchange rate fluctuation caused by sales, procurement and financing settled in non RMB (mainly US dollars), which may affect the profit level of the company. 3) Global market development risk: the company’s business covers more than 150 countries and regions around the world. If there are trade protection, debt problems, political conflicts and other situations in the country where the business is carried out, it may have an adverse impact on the company’s business development
