\u3000\u3 Jiangsu Eastern Shenghong Co.Ltd(000301) 021 Inno Laser Technology Co.Ltd(301021) )
Key investment points
Event content: on April 23, the company disclosed the annual report of 2021. In 2021, the company realized an operating revenue of 391 million yuan, a year-on-year increase of 15.32%; The net profit attributable to the parent company was 75 million, an increase of 14.24% over the same period. At the same time, the company announced the profit distribution plan for 2021, and planned to distribute cash dividends of 1.20 yuan (including tax) for every 10 shares.
The company’s performance in 2021 did not meet expectations, mainly due to the significant decrease in the year-on-year growth rate of the single quarter performance in 2021q4: in 2021q4, the company achieved an operating revenue of 97 million yuan, a year-on-year decrease of 21.42% (Q3 revenue increased by 10.97%), and a net profit attributable to the parent of 09 million yuan, a year-on-year increase of – 76.19% (Q3 net profit attributable to the parent increased by 88.96%), and the year-on-year growth rate of quarterly performance decreased significantly. We speculate that there may be the following aspects; 1) Base influence; The outbreak of the epidemic in the first half of 2020 delayed the purchase demand of some customers, especially the relative concentration of orders in the fourth quarter; 2) As an industrial processing equipment, the economic slowdown and epidemic disturbance will inevitably have an impact on the short-term demand of downstream industries; China’s GDP (constant price) in 2021q4 increased by 4% year-on-year, slowing down again compared with the 4.9% year-on-year growth of China’s GDP in 21q3; At the same time, after the national day of 2021, there have been many local epidemics in China; 3) The impact of product price competition and rising raw material prices on the profitability of the company; The gross profit margin of 21q4 company’s single quarter sales was only 34.71%, which decreased significantly month on month and year-on-year; According to the public exchange of information among Listed Companies in the same industry, the price competition of laser in 2021 is very fierce, especially in the traditional cutting and processing market.
Affected by the changes in China’s economic environment, although the development of the company temporarily encountered headwinds in the second half of 2021, it still maintained a high intensity of R & D investment and consolidated the company’s competitive strength: in 2021, the company’s R & D investment totaled 53 million yuan, an increase of 32.0% year-on-year compared with last year, and the proportion of R & D investment in operating revenue reached 13.49%. With high-intensity R & D investment, the company launched formula (I) series products in high-power nanosecond UV laser, and the crystal life is increased to more than twice that of the original product; The platform of picosecond AMT series laser products is upgraded to improve the performance index and stability index of the products; The performance level of deep UV 266 series products is further improved, and it is expected to become the core light source in the key processes such as chip manufacturing, wafer defect detection and microled; Femtosecond series products improve reliability by developing new components; According to the requirements of embedded modules, special high anti material micro welding process and high-precision vision assisted alignment micro welding system are developed.
In terms of application in emerging fields, the company’s products have made many breakthroughs, which is expected to broaden the medium and long-term growth space: 1) in the field of high-value medical implant intervention devices, the company has initially expanded and formed a relatively complete full line solution capability for many key processes such as “laser processing, heat setting and surface treatment”, which can meet the R & D, trial production and mass production needs of customers with high quality, high efficiency and high flexibility, End customers include Medtronic and other well-known enterprises at home and abroad. At the same time, the company has incubated the manufacturing business of relevant medical devices, and will adopt flexible mechanisms to support the development of the manufacturing business in the direction of specialization and scale in the future; 2) In the field of optical imaging, a new generation of laser scanning photoacoustic microscope insight rspam has been successfully developed, and it is planned to start small batch production in 2022; The product is preferentially sold to the scientific research market. At the same time, the company entrusts Sun Yat sen University to conduct in-depth development for clinical application based on the achievements of the product; 3) In the semiconductor field, in terms of key processes before chip manufacturing, the company has supplied lasers in batches to well-known foreign semiconductor equipment companies, realizing an income of 2.6183 million yuan; In terms of power semiconductors, the demonstration of wafer selective stripping has been completed and the layout of patents has been started.
Investment suggestion: the company’s performance in 2021 is lower than expected, which is expected to be related to changes in the economic environment and fierce competition in the laser equipment market. Since 2022, the impact of the epidemic, inflation and international situation on China’s economy has not ended yet. As a midstream equipment enterprise relying on the development of China’s manufacturing industry, the company’s performance in 2022 may inevitably be dragged down. We have lowered the company’s profit forecast for 2022; However, in the medium and long term, as the company still maintains high-intensity R & D investment and makes steady progress in product iteration, application scenario extension, breakthrough in emerging fields, the long-term investment value is still high. Considering comprehensively, we maintain the investment rating of the company’s overweight-a. it is estimated that the company’s earnings per share from 2022 to 2024 will be 0.47, 0.64 and 0.81 yuan respectively.
Risk tips: 1. The competitive price reduction of products exceeds expectations; 2. The demand impact caused by the economic slowdown and the epidemic; 3. The risk of dependence on key customers; 4. The risk of the stability of the control right of the actual controller; 5. The risk of the loss of core technicians.
