\u3000\u3 China Vanke Co.Ltd(000002) 236 Zhejiang Dahua Technology Co.Ltd(002236) )
Event: the company released the first quarter report of 2022 and the annual report of 2021. In 2021, the company realized an operating revenue of 32.835 billion yuan, a year-on-year increase of + 24.07%, and a net profit attributable to the parent company of 3.378 billion yuan, a year-on-year increase of – 13.44%; In 2022, Q1 company achieved an operating revenue of 5.848 billion yuan, a year-on-year increase of + 14.34%, and a net profit attributable to the parent company of 356 million yuan, a year-on-year increase of + 2.30%; In 2021, Q4 company achieved an operating revenue of 11.35 billion yuan, a year-on-year increase of + 10.20%, and a net profit attributable to the parent company of 979 million yuan, a year-on-year increase of – 9.12%.
Comments: AI enabling business has achieved initial results, the Internet of things market has broad prospects, the international economy recovers after the epidemic is alleviated, and the business in overseas markets is growing rapidly. The approval of the non-public offering plan continues to enable the company’s long-term performance growth.
Excluding factors such as equity transfer of subsidiaries, the overall performance of the company maintained steady growth in 21 years. 1) The company achieved an operating income of 32.835 billion yuan in 21 years, a year-on-year increase of + 24.07%, and a net profit attributable to the parent company of 3.378 billion yuan, a year-on-year increase of – 13.44%. We believe that the main reason is that the company sold its subsidiary Huatu microchip in 20 years, and its high investment income led to a high net profit base in 20 years. Excluding the influence of this factor, the overall performance of the company increased steadily. 2) The gross profit margin of the company in the 21st year was 38.91%, with a year-on-year increase of -3.79pct. We believe that the main reason is the high gross profit of thermal imaging products in 2020, resulting in a high base of the previous year. Excluding the above factors, the overall gross profit level remained stable in 21 years.
AI empowerment has achieved initial results, and innovative business has become an important driving force. Performance of splitting by Region: 1) domestic business achieved a revenue of 19.347 billion yuan in 2021, with a year-on-year increase of + 21.07%, and a gross profit margin of 37.28%, with a year-on-year increase of -0.58% PCT. Among them, tob business achieved a revenue of 8.622 billion yuan, a year-on-year increase of + 27.61%, and a gross profit margin of 42.06%, a year-on-year increase of + 0.29pct. The company built a technical architecture system of “one system and two platforms”, and AI enabled business achieved initial results; Tog business achieved a revenue of 5.852 billion yuan, a year-on-year increase of + 3.17%, and a gross profit margin of 41.75%, a year-on-year increase of + 1.05pct. The company continues to develop in transportation, traffic police, port, public livelihood and other industries; Other businesses had a year-on-year revenue of + 7.2 billion yuan, or + 3.7 billion yuan. 2) Overseas business achieved a revenue of 13.489 billion yuan in 2021, a year-on-year increase of + 28.63%. After the epidemic eased, the international economy recovered and the business in overseas markets grew rapidly. Split performance by product: the innovative business achieved a revenue of 2.847 billion yuan, a year-on-year increase of + 61.70%. The company continued to invest in large-scale R & D, with a R & D investment of 3.452 billion yuan in 21 years, a year-on-year increase of + 15.16%, accounting for 10.51% of the operating revenue. Taking advantage of its accumulation in the field of video and security, the company actively explores innovative businesses such as machine vision, Siasun Robot&Automation Co.Ltd(300024) , smart life and video cooperation, with promising growth prospects.
The non-public offering plan passed the review and helped the strategic development of smart IOT. The company issued 289 million non-public shares, raised 5.1 billion yuan, and the issue price was 17.67 yuan / share. The issue object was China Mobile. 1) The company adheres to the strategic position of intelligent IOT solution provider and operator service provider with video as the core, and the fixed increase project is conducive to promoting strategic development. 2) As the leader of comprehensive telecom operation enterprises, China Mobile has a total of 13.84 million government and enterprise customers, 210 million wired broadband customers and 870 million intelligent connections to the Internet of things. It has strong important strategic resources. The cooperation between the company and China Mobile is conducive to improving the company’s market share and influence in the family, small and medium-sized enterprise market and government enterprise market, and enabling long-term performance growth.
Investment suggestion: due to the epidemic and other uncertain factors, the expected net profit attributable to the parent company in 22-23 years is adjusted from 5.665/6.799 billion yuan to 3.953/4.56 billion yuan, and the expected net profit attributable to the parent company in 24 years is 5.305 billion yuan, maintaining the “buy” rating
Risk tips: the growth of innovative business market is less than expected, the R & D of smart IOT scheme is less than expected, the expansion of overseas business is less than expected, and the development of Tob business is less than expected
