\u3000\u3 China Vanke Co.Ltd(000002) 415 Hangzhou Hikvision Digital Technology Co.Ltd(002415) )
Event: on April 16, the company released the annual report and the first quarterly report of 2021. In 2021, the annual operating revenue reached 81.420 billion yuan, a year-on-year increase of 28.21%; The net profit attributable to the parent company was 16.8 billion yuan, a year-on-year increase of 25.51%. In the first quarter of 2022, the operating revenue was 16.522 billion yuan, a year-on-year increase of 18.11%; The net profit attributable to the parent company was 2.284 billion yuan, a year-on-year increase of 5.29%.
21. The annual performance grew steadily and the growth rate of 22q1 was bright: according to the announcement, the revenue of Q4 in a single quarter was 25.791 billion yuan, yoy + 20.06%, QoQ + 18.70%; The net profit attributable to the parent company is 5.835 billion yuan, yoy + 17.96%, QoQ + 30.12%. The company’s operation was stable, and the annual roe was 28.66% (+ 1.54pct). The change in net cash flow was mainly due to the increase in procurement and preparation expenses, the increase in long-term assets and foreign equity investment, the increase in net loan outflow and dividend distribution. In terms of expenses, the company continued to increase R & D investment and technological innovation. The proportion of R & D expenses in 17-21 years increased year by year, which were 7.62% / 8.99% / 9.51% / 10.04% / 10.13% respectively. Under the macro downward pressure and the impact of the epidemic, the revenue growth rate of 22q1 was excellent, and the profit growth rate was in line with market expectations, reflecting the company’s strong operating ability and boosting the confidence of the annual performance.
Rapid development of innovative business and recovery of overseas business: according to the disclosure of the annual report, in 2021, five innovative businesses had revenue of more than 1 billion and positive net profit (new thermal imaging business, automotive electronics and storage business), revenue of 12.271 billion yuan (YoY + 98.83%), Siasun Robot&Automation Co.Ltd(300024) business, thermal imaging business and automotive electronics business all grew by more than 100%. Among them, Siasun Robot&Automation Co.Ltd(300024) business integrates hardware products and releases a new generation of AMR software platform, machine vision products are expanded to 3D product line, and the demand for transformation and upgrading of traditional manufacturing industry and AI empowerment continues to increase, driving performance growth; Haikang micro film’s thermal imaging business iteratively optimizes products in Pan security, temperature measurement and commercial vision, and expands product matrix and revenue scale by improving positioning accuracy and broadening product sequence; Automotive electronics focuses on the intelligent driving demand of passenger cars and commercial vehicles. The number of new designated projects of passenger cars will double in 2021, and the expected sales of new contracts will double compared with the end of 2020. In terms of overseas business, the proportion of revenue increased by 24.23% year-on-year. The market share continues to increase, mainly due to the development of marketing end and the advantages of stable supply chain.
Stable growth of main business and stable confidence in equity incentive: under the macro disturbance environment outside China, the company focuses on its own ability growth, improves the supply chain ability and operates stably. In the 21st year, PBG business income was 19.161 billion yuan, with a year-on-year increase of 19.85%, and SMBG business income was 13.490 billion yuan, with a year-on-year increase of 46.49%. According to the disclosure of the public performance statement, after adding back the thermal imaging business (divided into innovative business), the year-on-year growth rate of EBG business is about 24%, which is in line with market expectations. We believe that the macroeconomic impact is mainly concentrated in PBG and SMBG businesses. With the pull of government bidding and the opening of channels in the market of small and medium-sized enterprises, the performance in 21 years is still strong. EBG and innovation business mainly focus on enterprise digital transformation and improving the innovation ability of enterprise intelligent IOT. The growth rate is stable and the growth is high. With the continuous improvement of business proportion, it will provide a new performance curve of the company and a continuous driving force for endogenous growth. At the same time, the company’s restricted stock plan in February also shows the management’s confidence in the company’s operating ability and business development plan. The unlocking conditions are that the roe is not less than 20% and the compound growth rate of four-year revenue is not less than 15%. Ensure the stability and continuous R & D ability of the company’s talents, and provide long-term impetus for the company’s expansion strategy at home and abroad.
Investment suggestion: we estimate that the company’s revenue from 2022 to 2024 will be 96.352 billion yuan, 114852 billion yuan and 136674 billion yuan respectively, the net profit attributable to the parent company will be 19.889 billion yuan, 23.5 billion yuan and 27.497 billion yuan respectively, and the EPS will be 2.13 yuan, 2.52 yuan and 2.95 yuan respectively, corresponding to 19 times, 16 times and 14 times of PE respectively, maintaining the “Buy-A” investment rating.
Risk warning: the risk of uncertainty in Global trade relations; Covid-19 epidemic risk in China; Economic downturn and geopolitical risks; The risk that the development of innovative business is not as expected; The risk that the demand of Chinese customers is less than expected; The risk that the progress of the spin off is less than expected.
