\u3000\u3 Shengda Resources Co.Ltd(000603) 486 Ecovacs Robotics Co.Ltd(603486) )
Event:
The company released the 2021 annual report and the first quarterly report of 2022: the operating revenue in 2021 was 13.086 billion yuan, yoy + 81%; The net profit attributable to the parent company was 2.010 billion yuan, yoy + 214%. 4q21 achieved an operating revenue of 4.842 billion yuan, yoy + 57%; The net profit attributable to the parent company was 680 million yuan, yoy + 73%. 1q22 company achieved an operating revenue of 3.201 billion yuan, yoy + 44%; Net profit attributable to parent company: RMB 424 million, yoy + 27%; Deduct 381 million yuan of non parent net profit, yoy + 20%. The profit distribution plan is to pay out 11 yuan (including tax) for every 10 shares, and the cash dividend rate is 31.4%.
Comments:
The revenue of the first quarterly report increased rapidly, and the competition for floor washing machines became fierce. In terms of products, in 2021, the revenue of Ecovacs Robotics Co.Ltd(603486) brand Siasun Robot&Automation Co.Ltd(300024) brand was 6.71 billion yuan (+ 58%), and that of Tianke brand household appliances was 5.14 billion yuan (+ 308%), accounting for 90.5% (+ 14.6pcts). 22q1 service Siasun Robot&Automation Co.Ltd(300024) brand business revenue yoy + 50%, Tianke brand business revenue yoy + 85%, and the proportion of private brand business revenue increased to 94.0%. Specifically: 1) Ecovacs Robotics Co.Ltd(603486) brand: N9 + and X1 series have been launched successively in 21 years. Self cleaning accounts for 55% of the revenue of Ecovacs Robotics Co.Ltd(603486) brand in China, and the average shipping price of Siasun Robot&Automation Co.Ltd(300024) brand is 1963 yuan (+ 44%). According to ovicloud, the year-on-year growth rates of online retail sales and retail sales of 21q3 / 21q4 / 22q1 Ecovacs Robotics Co.Ltd(603486) floor sweepers were 26% / 38% / – 6%, – 9% / – 22% / – 40% respectively. The terminal data showed that the growth of sales was mainly driven by price; In terms of market competition, the retail sales of X1 and N9 + accounted for 17.4% and 4.7% respectively in March 22 (down 1.3 / 5.6pcts compared with the end of 21), and the sales of new t10turbo jumped to 12.9% in March. 2) Tianke brand: in 21 years, the total shipment volume of Tianke brand reached 2.67 million units (+ 242%), and the average shipment price was 1923 yuan (+ 19%), of which the sales volume of new Fuwan 2.0 series accounted for 45% of the sales volume of floor washing machines in the whole year. According to ovicloud.com, the online retail sales of 21q4 / 22q1 land washing machines were 144% / 30% year-on-year respectively; In terms of market competition, the sales of Tianke brand accounted for 53.6% in March 22, down 16 percentage points compared with the annual level of 21. Many brands entered, and the industry competition was more intense; In terms of internal structure, from December 21 to March 22, the sales proportion of Fuwan 2.0 (LCD version), Fuwan 2.0 (LED version) and Fuwan slim changed by – 9.3%, 1.4% and 1.3% respectively. The accelerated entry of new brands has a downward traction on the price belt of the floor washer industry.
Expenses continued to increase, and 1q22 net interest rate fell by 1.7pcts year-on-year. In 2021, the company’s gross profit margin was 51.4% (+8.6pcts) and 1q22 gross profit margin was 49.5% (yoy+2.7pcts). The increase in gross profit margin was mainly due to the increase in the average price of products (increase in the proportion of independent brands + optimization of product structure). From the perspective of cost input, the sales cost rates in 2021 and 22q1 were yoy + 3.2pcts and yoy + 4.4pcts respectively. The company continued to increase consumer cultivation in order to establish brand awareness. 1q22 R & D expense rate reached 5.1% (YoY + 1.0pcts), and the company maintained a continuous high investment in R & D; Due to the increase of equity incentive payment fees, 1q22 management fee rate increased by + 0.8 percentage points year-on-year. 1q22’s net profit margin was 13.23% (21, 15.36% in the whole year), down 1.7 percentage points year-on-year. In terms of balance sheet, at the end of 1q22, the company’s own capital was 3.89 billion yuan, accounting for 37% of the total assets, and the operating safety cushion was sufficient. In 2021, the net operating cash flow was 1.76 billion yuan, and its ratio to the net profit attributable to the parent company reached 88%.
Profit forecast, valuation and rating: the company is the double material leader of floor sweepers and floor washers. It uses the dual brand strategy of ” Ecovacs Robotics Co.Ltd(603486) + Tianke” to continuously launch high-end new products. The overseas market is expected to benefit from the implementation of convertible bond projects, and a new round of equity incentive shows the confidence of the management. Considering that the repeated epidemic may weaken the consumption ability of residents and the fierce competition in the washing machine market, the net profit of the company from 2022 to 2023 was reduced to 2.52 billion yuan / 3.04 billion yuan (8% / 18% lower than the previous forecast), the new profit forecast for 2024 was 3.76 billion yuan, and the current price corresponding to PE was 23 / 19 / 15 times, maintaining the “overweight” rating.
Risk tip: chip supply is in short supply, market competition intensifies, and the shipping channel is not smooth.
