\u3000\u3 Shengda Resources Co.Ltd(000603) 019 Dawning Information Industry Co.Ltd(603019) )
[key points of investment]
Outstanding performance, deduction of non net profit increased by 47%. The company released its 2021 annual report. In 2021, it achieved a revenue of 11.2 billion yuan, a year-on-year increase of 10.23%. The net profit attributable to the parent company was 1.158 billion yuan, with a year-on-year increase of 40.78%, and the deduction of non net profit was 773 million yuan, with a year-on-year increase of 46.98%. The net operating cash flow was -495 million yuan, mainly due to the increase in expenditure on the purchase of raw materials. 21q4 achieved a revenue of 4.708 billion yuan in a single quarter, a year-on-year increase of + 11.99%. In Q4, the net profit attributable to the parent company and the net profit deducted from non net profit in a single quarter were 691 million yuan and 537 million yuan respectively. The balance of contract liabilities at the end of the period was 1.853 billion yuan, with a year-on-year increase of 38.75%, and the future income can be expected.
The gross profit margin increased and all product lines grew in an all-round way. In 2021, the gross profit margin was 23.74%, a year-on-year increase of + 1.61pct. From the perspective of product structure, the company’s high-end computer products achieved a revenue of 8.88 billion yuan, a year-on-year increase of 10.34%, and the gross profit margin was 16.20% (+ 1.39pct); The revenue of storage products was 1.064 billion yuan, with a year-on-year increase of 6.22% and a gross profit margin of 26.96%, an increase of 4.69pct over the previous year; Software development, system integration and technical service business realized a revenue of 1.253 billion yuan, a year-on-year increase of 12.98%, and the gross profit margin was 74.30% (+ 0.11pct). From the downstream market structure, the enterprise market revenue was 5.883 billion yuan (+ 12.70%), the government market revenue was 2.803 billion yuan (+ 8.66%), and the public utilities market revenue was 2.510 billion yuan (+ 6.43%), with steady growth in all product lines and industry markets. The annual sales expenses were 499 million yuan, the management expenses were 241 million yuan and the R & D expenses were 962 million yuan. The total R & D investment is 1.534 billion yuan, with a capitalization ratio of 45.39%. The company has invested 3.395 billion yuan in R & D in recent three years, and 575 new R & D personnel were added in 2021.
Xinchuang is the core position and actively participates in the construction of digital economy. The company is the core leader of Xinchuang. In the telecommunications field, the company participates in the centralized procurement projects of three major operators, and storage products are also shortlisted in the centralized procurement, distributed file storage is shortlisted in the centralized procurement, and distributed block storage is shortlisted in succession; In the energy industry, the company provides domestic computing infrastructure for many manufacturers and provides software and hardware support for wind turbine design and development and wind farm operation; In the financial industry, the company’s server products have entered key customers in industries such as the first bank and the two sessions, large state-owned banks, policy banks and joint-stock banks. With the continuous deepening of industry information innovation, the company will benefit from a wide range of industry layout and mature domestic ecological overall adaptability. Energy consumption cost has become an important indicator for the construction of new data center. The company’s self-developed immersion liquid cooling can help the data center realize natural cooling throughout the region throughout the year, and the minimum pue value can be reduced to 1.04.
Haiguang information has held a meeting in March to play a synergistic effect. On March 16, haiguang information technology innovation board, a joint-stock subsidiary of the company, held a meeting. At the end of the reporting period, the total assets of haiguang information under the consolidated standard were 10.457 billion yuan, the net assets were 6.261 billion yuan, the revenue in 2021 was 2.310 billion yuan, the operating profit was 436 million yuan, and the net profit attributable to the parent was 327 million yuan. As the leader of domestic chip industry, haiguang information is expected to play a synergistic effect and help the company enhance its ecological strength in independent and controllable industries.
[investment suggestions]
The company is a leading enterprise in China’s information industry, shouldering the important task of localization, fully benefiting from the dividends of new infrastructure, and is actively promoting the landing of multiple data center projects at the East digital West computing hub node. It is estimated that from 2022 to 2024, the company’s operating revenue will be 13.017/15.163/17.583 billion yuan respectively, the net profit attributable to the parent company will be 14.95/18.82/2.371 billion yuan respectively, the EPS will be 1.02/1.29/1.62 yuan respectively, and the corresponding PE will be 28 / 22 / 18 times respectively, so it is rated as “overweight”.
[risk tips]
Market competition intensifies, affecting the profitability risk;
The investment in downstream information innovation and new infrastructure is less than the expected risk;
There is a risk of renewed waves in China US relations.
