\u3000\u3 Guocheng Mining Co.Ltd(000688) 665 Cubic Sensor And Instrument Co.Ltd(688665) )
Performance review
The company released the first quarter report of 2022 on April 27. In 2022q1, the company achieved an operating revenue of 135 million yuan (a year-on-year increase of 27.88%) and a net profit attributable to the parent company of 43 million yuan (a year-on-year increase of 30.79%); Through precision marketing, the company has improved the self production rate of key parts, increased the sales of high margin products, effectively controlled the sales and management expenses, and achieved rapid growth in performance.
Business analysis
Significant results were achieved in cost control, and R & D investment continued to increase. The main reasons for the high performance of the company are as follows: 1) with CO2 gas sensor and dust sensor as the core products, the market share of gas sensors such as air quality and medical health has increased significantly, and the company has actively expanded its overseas market share; 2) The operating efficiency of the company was improved, and the sales expense rate maintained a downward trend, falling to 5.23% in 2022q1; 3) R & D investment continues to increase, and R & D rates from 2020 to 2022q1 are 6.46%, 7.99% and 8.73% respectively, showing a gradual upward trend. Core technology constitutes the basis of the company’s core competitiveness, so as to steadily improve the profitability.
The product line continues to be extended, and the fund-raising and investment technology center helps to achieve the “1 + 3” development strategy. 1) The product line of civil air quality sensor extends to formaldehyde, VOC, radon and other monitoring objects; Take the hybrid air quality sensor as the standard configuration to further improve the technical threshold. 2) Ultrasonic gas meter business has established product production and quality control system to realize small batch sales. Meanwhile, the Jiashan raised investment project has been started in mid-2021, with an annual output of 3 million ultrasonic gas sensors and 1 million supporting instruments and meters. The company is active in overseas market expansion, has many high-quality partners, and the product market prospect is good.
Vehicle products have recently been designated for a new project of 125 million yuan. On April 21, the company announced that it had received the notice of fixed-point of two projects from China’s main engine factory, involving the fixed-point amount of automobile comfort system sensor projects, with a total amount of about 125 million yuan. By the end of 2021, the company has obtained about 10 million fixed-point sensors for the on-board sensor project, and the performance of on-board products is expected to be realized.
Investment advice
It is estimated that the company’s revenue from 2022 to 2024 will be RMB 838 / 1175 / 1611 million, the net profit attributable to the parent company will be RMB 258 / 374 / 509 million, the EPS will be RMB 369, RMB 5.35 and RMB 7.27 respectively, and the corresponding PE will be 29 times, 20 times and 15 times respectively, maintaining the “buy” rating.
Risk tips
The risk of technology research and development and product innovation, the risk of intensified industry competition, the risk of lifting the ban on restricted shares, etc.
