\u3000\u3 Guocheng Mining Co.Ltd(000688) 622 Guangzhou Hexin Instrument Co.Ltd(688622) )
Event overview
The company released its annual report for 2021, realizing an operating revenue of 464 million yuan, a year-on-year increase of + 48.66%; The net profit attributable to the parent company was 785747 million yuan, a year-on-year increase of 13.13%, and the net profit not attributable to the parent company was 44.33 million yuan, a year-on-year decrease of – 14.29%.
Analysis and judgment:
The field of environmental monitoring has developed steadily, and water quality monitoring has been recognized by the market
The company’s revenue is highly focused on PM2 in the field of atmospheric environmental monitoring 5. And voco3 monitoring. From 2018 to 2020, the revenue in the field of environmental monitoring accounted for 95%, 96% and 95% respectively, including instrument sales, data analysis and technical operation and maintenance. The core products are spa and SPI series instruments. In 2021, according to the main business disclosed by the company, it is estimated that the contribution of revenue in the field of environmental monitoring is 89%. The company’s dependence on environmental monitoring business has decreased, but it is still the main source of revenue. In addition to atmospheric detection, the company began to expand to the field of water quality and soil monitoring and promote the industrial application of gcms1000, gcms2000, ggt-0620 and DT-100. In 2021, the company won certain market recognition in the field of water quality monitoring.
The field of environmental monitoring includes 289 million yuan of environmental protection online monitoring instruments (year-on-year + 45%), 98.48 million yuan of data analysis services (year-on-year + 11%), and 27.08 million yuan of technical operation and maintenance services (year-on-year + 59%). In terms of instrument varieties, the VOCs monitoring instrument SPI series, which contributed 40% of the company’s revenue last year, sold 52 units this year, a year-on-year increase of – 20%; Similarly, the sales volume of ac-gcms used for VOCs monitoring was 31, with a year-on-year increase of + 138%. From a comprehensive perspective, the most important VOCs monitoring field in atmospheric monitoring increased slightly.
Breakthroughs have been made in the field of medical and health care to realize the sales of instruments
According to the statistics of mass spectrometer application fields in SDI report, biomedical field (including pharmaceutical, medical, biotechnology and some related academic research) is the largest application field of mass spectrometry, accounting for about 40% – 50% of the total, and it is also the focus of major instrument enterprises abroad. In this field, the company has launched a fully automatic microbial detection mass spectrometer, which is in the market development stage, and is actively engaged in the research and development of triple quadrupole mass spectrometer, inductively coupled plasma mass spectrometer and quadrupole time-of-flight tandem mass spectrometer. In 2021, the company achieved a revenue of 6.756 million yuan in medical instruments and consumables, which is expected to open the second growth point.
Many factors led to the decline of the company’s non deduction profit margin
1) the gross profit margin decreased significantly. The gross profit margin of the company in the most important environmental monitoring field has decreased significantly, including -12.58pct in environmental monitoring field, -11.51pct in data analysis service and -18.47pct in technical operation and maintenance service, which is mainly due to the decrease of gross profit margin due to the increase of general contracting projects of the company. In addition, the company’s gross profit margin on new products is low due to market expansion and other reasons. For example, the gross profit margin of medical instruments and consumables is only 23.16%, which is significantly lower than 49% of environmental protection online monitoring instruments.
2) the government subsidy included in the current profit and loss was 40.266 million yuan, a year-on-year increase of + 90%, resulting in the company’s deducted non net profit being significantly lower than the net profit attributable to the parent company.
Investment advice
We raised the forecast of the company’s revenue of 621 / 863 million yuan in 22-23 years to 648 / 902 million yuan, and increased the forecast of 24-year revenue of 1.274 billion yuan; The forecast of the company’s net profit attributable to the parent company for 22-23 years was lowered to 103 / 137 million yuan, and the forecast of net profit attributable to the parent company for 24 years was increased to 186 million yuan; Reduce eps1 in 22-23 years The forecast of 80 / 2.55 yuan is increased to 1.47/1.95 yuan, and the 24-year EPS forecast is increased by 2.66 yuan. Corresponding to the closing price of 25.42 yuan / share on April 26, 2022, PE in 22-24 years is 17 / 13 / 10 times respectively. Considering the low valuation and great development potential of the company, we adjusted the corresponding rating of the company to “overweight”.
Risk tips
Iterative risk of technological upgrading, profit dependence on government subsidies, less than expected market expansion, systemic risk of capital market
