Dongfang Electronics Co.Ltd(000682) company information update report: the performance has increased steadily and is expected to continue to benefit from the high prosperity of smart grid

\u3000\u30 Shenzhen Zhenye(Group)Co.Ltd(000006) 82 Dongfang Electronics Co.Ltd(000682) )

Smart grid has a high boom and maintains the “buy” rating

As a small giant of smart grid, the company ranks in the forefront of the industry in the fields of distribution network, dispatching and smart meter. We believe that the company is expected to benefit from the high prosperity of smart grid under the background of “double carbon”. We maintain the original profit forecast and add the profit forecast for 2024. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 421, 513 and 627 million yuan, EPS will be 0.31, 0.38 and 0.47 yuan / share, and the current share price corresponds to 16.1, 13.2 and 10.8 times of PE, maintaining the “buy” rating.

Event: the company released the 2021 annual report, and the annual performance increased steadily

The company released its 2021 annual report. The company’s main business grew steadily, realizing an operating revenue of 4.486 billion yuan, a year-on-year increase of 19.38%; The net profit attributable to the parent company was 348 million yuan, a year-on-year increase of 23.12%.

“Double carbon” target is expected to catalyze the sustained prosperity of smart grid

The State Grid issued a “double carbon” action plan, proposing to promote the transformation of energy and electricity to clean energy and accelerate the upgrading of power grid to energy Internet. The goal is to initially build an international leading energy Internet by 2025. China Southern Power Grid issued the white paper on digital power grid promoting the construction of a new power system with new energy as the main body, and proposed to take multiple measures to build a new power system with new energy as the main body based on the construction of digital power grid. Under the background of “double carbon”, promoting the intelligent upgrading and digital transformation of power grid has become the focus of power grid companies, which is expected to catalyze the sustained boom of digital transformation of energy.

The company has full stack solutions, leading the market competitiveness

The company has decades of experience in providing solutions for customers in the power market. It has automation products and system solutions from power generation, transmission, transformation, distribution, power consumption and other links. It also has completely independent intellectual property rights in power dispatching, substation protection and monitoring, power distribution, smart meter and other aspects. Its products and solutions have international advanced and China’s leading level. At the same time, based on the deep cultivation of the power market, the company continues to expand the comprehensive energy management market, undertakes the national key R & D plan in cooperation with Guangzhou Power Supply Bureau, and has rich technical accumulation in the field of comprehensive energy service management. We believe that the company is a “little giant” of smart grid. It is expected to take the east wind of smart grid construction for a long time and enter the channel of rapid performance growth.

Risk warning: the investment landing of smart grid is less than the expected risk, and the company’s technology research and development is less than the expected risk

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