\u3000\u30 Beijing Jingyeda Technology Co.Ltd(003005) 02 Eoptolink Technology Inc.Ltd(300502) )
Event: on the evening of April 21, the company released the first quarterly report of 2022, with a revenue of 739 million yuan, a year-on-year increase of 18.3%, a net profit attributable to the parent company of 132 million yuan, a year-on-year increase of 17.8%, and a deduction of 137 million yuan, a year-on-year increase of 27%.
Expenses increased significantly year-on-year, profits were under pressure and cash flow was good. The company realized a net profit attributable to the parent company of 132 million yuan in the first quarter, slightly lower than our expectation. The company’s R & D expenses in the first quarter were 36.82 million yuan, a year-on-year increase of 107.75%, an increase of 19.1 million yuan; The financial expenses of Q1 increased by 7.25 million yuan compared with the same period due to the increase of exchange loss; The company’s investment loss in the first quarter increased by 2.23 million yuan compared with the same period last year; Other income of the company decreased by 2.48 million yuan, mainly due to the decrease of relevant government subsidies. The net cash flow from operating activities of the company was 17.17 million, up 158% year-on-year. Q1 gross profit margin was 33.12%, up 2.59 percentage points year-on-year. In the first quarter, the cost side increased more, resulting in pressure on the overall profit, and Q2 is expected to return to normal.
Inventories hit a record high, highlighting the adequacy of orders and delivery capacity. The company’s inventory at the end of the first quarter of 2022 reached 1.665 billion yuan, a record high. The company’s inventory has continued to rise since 20q3, mainly by increasing the reserves of key raw materials such as chips. Referring to past experience, the company’s inventory usually makes a certain amount of preparation in advance in combination with customer demand. The current inventory status reflects the company’s confidence in orders and customer demand, helps it deliver customer orders on time and steadily release production capacity. In recent years, while actively expanding customers, the company’s supply chain management level is in place to help the company grasp industry opportunities.
The layout of 800g and silicon light is complete, laying a good foundation for the future. The company acquired Alpine silicon photon technology platform, provided single wavelength 100g optical solution for data center connection, and provided pam4 products to strengthen the company’s layout in the field of silicon light. At the same time, the company’s 800g series product portfolio has been released for exhibition, and it is expected to gradually enter the commercial period in the future. The company actively participates in the layout of the industry’s cutting-edge technology development route. With the continuous iterative progress of the industry, we believe that the company’s core technology experience will continue to strengthen and its market position is expected to continue to improve, opening up a new space for 800g and subsequent higher speed development.
Investment suggestion: the core focus of the company this year is the expansion of new customers and the continuous large-scale demand of overseas cloud manufacturers. We expect the net profit attributable to the parent company in 20222024 to be RMB 810 / 960 / 1.13 billion, corresponding to EPS of RMB 1.60/1.90/2.23, corresponding to the current pe17 / 15 / 12x. Referring to the historical valuation of the industry, the whole optical module industry is at the bottom level. Considering the industry boom and the company’s performance growth, the current valuation is attractive and the “buy” rating is maintained.
Risk tip: 5g progress does not meet expectations and market competition intensifies.
