\u3000\u3 China Vanke Co.Ltd(000002) 050 Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) )
The overall revenue of 2022q1 company exceeded the expectation, and the profitability has now reached an upward turning point
In 2022q1, the company realized an operating revenue of 4.804 billion yuan, a year-on-year increase of + 40.94%; The net profit attributable to the parent company was 453 million yuan, a year-on-year increase of + 25.81%; The net interest rate was 9.45%, year-on-year -1.23pct (mom + 0.32pct). We believe that the company’s overall revenue exceeded expectations, and the decline in net profit margin was mainly due to the impact of raw materials and freight of home appliance microchannel business. However, in terms of breakdown, the price of raw materials in the automotive business began to conduct downward, the gross to net ratio increased year-on-year, and the profitability has now reached an upward inflection point.
We are optimistic about the high growth segments of the company’s home appliance business and the high growth of the new energy vehicle business
In terms of business: (1) household appliance business, the operating revenue in 2022q1 was 3.2 billion yuan, a year-on-year increase of + 32%; The net profit attributable to the parent company was 280 million yuan, a year-on-year increase of + 9.5%; The gross profit margin was 23.3%, year-on-year -3pct. (2) Auto zero business achieved an operating revenue of 1.6 billion yuan in 2022q1 (including 1.4 billion new energy vehicles), a year-on-year increase of + 63%; The net profit attributable to the parent company was 175 million yuan, a year-on-year increase of + 66.3%; The gross profit margin was 23.35%, year-on-year + 0.3pct. We continue to be optimistic about the recovery of the company’s home appliance business and high growth segments such as commercial refrigeration after the recovery of consumption, as well as the high growth of the new energy vehicle business.
Profit forecast and valuation
We are optimistic about the steady growth of the company’s home appliance business and the outbreak of new energy business. It is estimated that the company’s operating revenue from 2022 to 2024 will be RMB 225.01/30.252/40.132 billion respectively, with the corresponding growth rate of 40.45% / 34.44% / 32.66% respectively; The net profit attributable to the parent company was RMB 2.480/3.529/4.918 billion respectively, and the corresponding growth rate was 47.25% / 42.31% / 39.37% respectively. The corresponding PE is 25X / 17x / 12x respectively.
Risk tips
The recovery of consumer demand for household appliances is less than expected, the sales volume of new energy vehicle industry is less than expected, and the price fluctuation risk of raw materials.
