\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 94 Joy Kie Corporation Limited(300994) )
Core view
In the first quarter of 2012, the revenue growth was under pressure and the performance was excellent. In 2021, the annual revenue was 3.71 billion yuan (+ 62.3%), and the net profit attributable to the parent company was 205 million yuan (+ 30.9%); In the fourth quarter of 2001, the single quarter revenue was 1.116 billion yuan (+ 24.8%), and the net profit attributable to the parent company was 58 million yuan (- 5.5%); In the first quarter of 2022, the single quarter revenue was 774 million yuan (+ 3.3%), and the net profit attributable to the parent company was 42 million yuan (+ 27.4%). In the context of epidemic prevention and control, the company performed well in the first quarter.
In 2021, benefiting from the overseas epidemic, the electric bicycle business made great efforts and the independent brand was steadily promoted. In the past two years, affected by the overseas epidemic, there is a strong demand for personal short-distance transportation. As a major bicycle exporter in the world, China has taken the lead in effectively controlling the epidemic, enabling Chinese bicycle enterprises to rapidly expand production and meet the needs of the global market. Therefore, we can see that in 2021, Jiuqi’s ODM business revenue achieved a high growth of 73% year-on-year; At the same time, the two new directions of the company’s focus in recent two years – electric bicycle and independent brand also performed well. In 2021, the revenue of electric bicycle business achieved a high growth of 101% year-on-year, and the proportion of revenue increased to 9.6%; Independent brand business revenue achieved a relatively high growth of 31% year-on-year. Since the self owned brand business bears the shipping cost by itself, the sharp rise in shipping charges has led to a year-on-year decrease of 14.5 percentage points in the gross profit margin of the self owned brand business in 2021; The gross profit margin of ODM business remained basically stable.
In the first quarter of 2022, the epidemic caused pressure on revenue growth, and the company’s raw material cost decreased to ensure profit growth. In the first quarter, due to the sealing and control management of the epidemic in many places, the transportation of the company’s products was blocked, superimposing the negative impact of the Russian Ukrainian war, resulting in pressure on the revenue growth in the first quarter, with a year-on-year growth rate of 3.3%. In the first quarter of this year, the cost of raw materials decreased year-on-year, driving the comparable gross profit margin to increase year-on-year. Therefore, we can see that the net profit attributable to the parent company in the first quarter increased by 27% year-on-year. Since the statistical caliber of logistics freight is adjusted from expense to cost, we add “operating cost + sales expense” together, and its proportion in revenue has decreased by about 1 percentage point year-on-year. Although the overseas manufacturing supply chain began to recover gradually this year, considering the advantages of design openness accumulated by Jiuqi for a long time and the advantages of its own brand accumulated in recent two years, under the assumption that the impact of the epidemic in China is controllable, we believe that the company’s annual revenue and profit are still expected to achieve rapid growth this year.
Risk tips: changes of epidemic situation in China; The rise in raw material costs exceeded expectations; Business expansion was lower than expected.
Investment suggestion: slightly adjust the profit forecast and maintain the “buy” rating.
It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 297 / 411 / 521 million yuan respectively (the adjustment range from 22 to 23 years is – 2.2% / + 0.2%), with a year-on-year increase of 45% / 38% / 27% respectively. Considering that the company is affected by uncertain factors in the short term, but the long-term logic remains unchanged, the company is given a “buy” rating. Now the PE valuation of EPS corresponding to the stock price in 22-23 years is 18x and 13X respectively.
