\u3000\u3 Jiangsu Eastern Shenghong Co.Ltd(000301) 029 Dongguan Yiheda Automation Co.Ltd(301029) )
Events: the company disclosed the quarterly reports of 2021 and 2022q1: 1) in 2021, the company achieved a revenue of 1.8 billion yuan, a year-on-year increase of 49.0%, a net profit attributable to the parent company of 400 million yuan, a year-on-year increase of 47.7%, a gross profit margin of 41.57%, yoy-2.28 PCT, a net profit margin of 22.22%, yoy-0.21 PCT; 2) In 2021, Q4’s revenue was 474 million yuan, a year-on-year increase of + 24.6%, and the net profit attributable to the parent company was 94 million yuan, a year-on-year increase of + 9.7%. The gross profit margin was 34.82%, yoy-9.91 PCT, and the net profit margin was 19.82%, yoy-2.69 PCT; 3) In 2022, Q1 revenue was 487 million yuan, a year-on-year increase of + 52.6%, net profit attributable to parent company was 100 million yuan, a year-on-year increase of + 63.7%, gross profit rate was 39.71%, yoy-3.29 PCT, net profit rate was 20.72%, yoy + 1.41 PCT.
Benefiting from the continuous improvement of the company’s share and the high prosperity of new energy and photovoltaic industry, the company achieved high growth in 2021. ① New energy: mainly lithium battery equipment, with a revenue of 465 million yuan in 2021, yoy + 146.6%, gross profit margin of 37.1%, yoy-3.8pct. According to the data of lithium battery research institute of Gaogong, the output value of lithium battery equipment in China reached 57.5 billion yuan in 2021, with a year-on-year increase of 100.3%. The company fully benefited from the rapid growth of the industry; ② 3C: in 2021, the company achieved a revenue of 463 million, yoy + 64.5%, gross profit margin of 42.1%, yoy-1.0pct. According to the company’s disclosure, the global smartphone shipment increased by 4.84% year-on-year in 2021, but the company’s share in leading customers continued to increase, ensuring the high growth of 3C; ③ Automobile: in 2021, the company achieved revenue of 187 million, yoy + 5.6%, gross profit margin of 43.8%, yoy-2.5pct. According to the statistics of Automobile Industry Association, China’s automobile output increased by 3.52% year-on-year in 2021, and the growth rate of the company was slightly higher than that of the industry; ④ Photovoltaic: in 2021, the revenue reached 96 million, yoy + 76.8%. In 2021, the new installed capacity of photovoltaic in China increased by 13.9% year-on-year, and the growth rate of the company exceeded that of the industry; ⑤ Industry Siasun Robot&Automation Co.Ltd(300024) : revenue of 81 million in 2021, yoy + 37.9%.
The operation quality remains stable and the profitability is stable. ① Inventory: the annual inventory turnover days in 2021 decreased by 6.2 days to 107.4 days year-on-year; ② Accounts receivable: in 2021, the turnover days of accounts receivable were controlled at 61.1 days, a slight increase of 0.36 days year-on-year, which was relatively benign. Cash flow deteriorated slightly: ③ cash flow: the cash received from selling goods and providing labor services / revenue decreased to 82.2%, and the net cash flow / net profit from operating activities decreased to 0.58, a decrease of 0.33 compared with 0.91 last year, which is related to the increase of goods preparation; ④ Per capita output value: it will reach 840000 people / year in 2021, with a year-on-year increase of 10.2%. ⑤ Product category: in 2021, the number of SKUs exceeded 1.1 million, with a year-on-year growth rate of more than 22%, the annual order processing volume was about 770000, with a year-on-year growth rate of 40%, and the annual shipment volume was about 3.3 million items, with a year-on-year increase of 42.5%.
It is expected to maintain rapid growth in 2022: 1) the business attribute of the company essentially reflects the general trend of automation upgrading of China’s manufacturing industry; 2) At present, the downstream with relatively fast growth rate of the company includes lithium battery equipment, photovoltaic equipment, Siasun Robot&Automation Co.Ltd(300024) , medical equipment and other fields. It is expected to achieve rapid growth in 2022. At the same time, the newly expanded field of semiconductor equipment is expected to form a new business increment in 2022; 3) The company’s IPO has completed the capacity expansion, which can support the total annual shipment of 4.8 million items (2.316 million items in 2020), and the capacity has increased greatly.
Investment suggestion: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 590 / 830 / 1.14 billion respectively, and the corresponding PE will be 37x / 26x / 19x respectively, maintaining the “recommended” rating.
Risk tips: 1 Risk of SKU expansion failure; 2. The intensification of price war in the industry leads to the risk of low profitability.
