\u3000\u3 China Vanke Co.Ltd(000002) 881 Meig Smart Technology Co.Ltd(002881) )
Key investment points
Event: the company released the annual report of 2021 and the report of the first quarter of 2022. In 2021, the company achieved a revenue of 1.97 billion yuan, a year-on-year increase of + 75.7%, and a net profit attributable to the parent company of 120 million yuan, a year-on-year increase of + 330.5%; Among them, Q4 achieved a revenue of 650 million yuan in a single quarter, a year-on-year increase of + 50.1%, and the net profit attributable to the parent company was 40 million yuan, a year-on-year increase of + 155.4%. In the first quarter of 2022, the revenue was 400 million yuan, a year-on-year increase of + 54.3%, and the net profit attributable to the parent company was 20 million yuan, a year-on-year increase of + 59.7%.
In the whole year of 21, it reached a new high with the performance of 22q1, and the gross profit margin of Q1 rebounded month on month. The company achieved a revenue of 1.97 billion yuan in 21 years and 400 million yuan in Q1 in 22 years, both of which reached a record high since the establishment of the company. The high increase in revenue mainly comes from the rapid growth of the company’s customer base and the rapid growth of 4gcat1 / 4 module, 5g module and FWA product shipments. In terms of gross profit, affected by the price rise of raw materials and the adjustment of product structure, the gross profit margin of the company’s module business decreased by 3.3pp year-on-year to 19.4%. In terms of expense rate, the three expense rates of the company in 2021 were 5.1%, a year-on-year decrease of 0.4pp, and the total amount of R & D investment reached 230 million yuan, a year-on-year increase of 26.8%.
The prosperity of the industry remained high, and the sales of wireless modules increased by 70.5%. According to GSMA data, by 2025, the number of global Internet of things connections will reach 24.6 billion and CAGR will reach 13%, of which China’s Internet of things connections will reach 8.11 billion and CAGR will reach 14.1%. Thanks to the industry’s ultra-high vision and the company’s own comprehensive advantages, the company’s sales of wireless communication modules and solutions reached 12.77 million in 2021, with a year-on-year increase of 70.5%. In the same period, the business realized a revenue of 1.82 billion yuan, a year-on-year increase of 73%, and the precision component business realized a revenue of 426000 yuan, a year-on-year decrease of 64.2%. According to counterpoint, Q4 of the company ranked among the top 3 in the world and the second in China for the first time in the Internet of things module industry in 2021, and has grown into a global leader in wireless modules.
Continuous optimization of customer structure and complete product matrix help the company develop steadily in the long term. In the context of the company’s growing number of customers, the customer structure continues to be optimized. In 2021, the revenue of the company’s top five customers was 510 million yuan, accounting for a decrease of 26pp to 25.8%. The total number of customers increased, while the proportion of single customer revenue decreased. In 2021, overseas regions achieved revenue of 410 million yuan, accounting for 20.7%. In addition, the company’s product matrix continues to expand and has formed a complete product series of intelligent modules. Among them, yuvcamera technology based on 5gsoc chip platform has been exclusively developed and applied in the field of intelligent network connected vehicles, which has a leading technology. At the same time, the products of data transmission module are constantly enriched, covering 4 / 5G, Nb IOT, WiFi module and FWA terminal. The company’s products continue to make breakthroughs at home and abroad.
Profit forecast and investment suggestions. It is estimated that the company’s EPS from 2022 to 2024 will be 1.18 yuan, 1.80 yuan and 2.58 yuan respectively, and the corresponding PE will be 24, 15 and 11 times respectively, maintaining the “buy” rating.
Risk tip: the risk of sharp price reduction due to intensified industry competition; Risk of product R & D progress falling short of expectations; The recovery of the epidemic is not as expected, resulting in the risk of weak downstream demand; Exchange rate fluctuation risk.
