\u3000\u3 Guocheng Mining Co.Ltd(000688) 036 Shenzhen Transsion Holdings Co.Ltd(688036) )
Mobile phone leaders in emerging markets continue to build high barriers to competition in the African market and constantly tap new market opportunities
Based on the African market, the company locates multi-level consumer groups through Tecno, itel and infinix mobile phones, continuously optimizes the product structure and improves the brand image of the company's products. In 2021h1, the sales of medium and high-end models accounted for 20%, and the proportion of smartphone revenue in the first three quarters of the company has risen to 85%. The company's sales proportion of smart phones and medium and high-end models continues to increase, driving the improvement of the average ASP of the company's mobile phone products and laying the foundation for the company's long-term profitability. In addition, the company actively explores emerging markets outside Africa. In the first three quarters of 2021, the company's smartphone shipments in India, Pakistan and Bangladesh reached 15%, 10% and 2.8% respectively. Among them, the market share of smartphones has remained the first in Bangladesh and Pakistan, and the revenue share of strategic markets such as India and Nepal has increased rapidly. At the same time, the company is also seeking opportunities to expand the Middle East markets such as Iraq, Saudi Arabia and Turkey, as well as the markets of Latin America and Russia. In the future, it is expected to reprint the company's business path in Africa and achieve breakthroughs in new markets.
Multi track business goes hand in hand and continues to build a brand ecological closed loop
While focusing on the development of mobile phone business, the company makes efforts at the software end and hardware end at the same time, and improves the company's brand strength in multiple dimensions: 1) on the software end, the company fully enjoys the traffic dividend brought by its mobile phone's leading advantage in Africa and other markets, and layout the mobile Internet business from the two aspects of OS and independent app. By 2021q3, the number of users of voice OS had reached 220 million, and the contribution of application distribution and advertising business to revenue for the value-added realization of stock active users also continued to increase. In terms of independent apps, as of 2021h1, the company has more than 10 self-developed and cooperative applications with more than 10 million monthly live users. Each app team operates independently and preempts the layout of each application track. 2) On the hardware side, the company expands its category business, firmly focuses on the category and the strategy of creating popular models, focuses on TV, power bank, TWS headset and other products, Wuxi Online Offline Communication Information Technology Co.Ltd(300959) dual channels work at the same time, continues to build the business sales platform, and cooperates with its after-sales service brand carlcare to improve consumers' shopping experience and help the company form a good reputation effect.
Profit forecast
It is predicted that the revenue of the company from 2021 to 2023 will be 49.298 billion yuan, 61.508 billion yuan and 73.841 billion yuan respectively, and the EPS will be 4.88, 5.91 and 7.10 yuan respectively. The corresponding PE of the current stock price will be 18, 15 and 13 times respectively, and the "recommended" investment rating will be given.
Risk tips
The risk of intensified industry competition; The downstream demand is lower than the expected risk; New market development is less than expected risk; Risks of emerging market economic development falling short of expectations.
