\u3000\u30 Beijing Telesound Electronics Co.Ltd(003004) 54 Sangfor Technologies Inc(300454) )
Event: the company released the first quarterly report of 2022. The company achieved a revenue of 1.144 billion yuan, a year-on-year increase of 4.76%, a net profit attributable to the parent of -518 million yuan, a year-on-year decrease of - 438.90%, a loss attributable to shareholders of listed companies after deducting non recurring profits and losses of 580 million yuan, a year-on-year decrease of - 281.63%, and a basic earnings per share of -1.25 yuan.
The epidemic affected short-term performance. In a single quarter, the company's 22q1 revenue was 1.144 billion, a year-on-year increase of 4.76%, and the net profit attributable to the parent was -518 million, a year-on-year decrease of - 438.90%. The main reason is that the epidemic situation in Shenzhen, Dongguan and other places has led to the delayed arrival of some raw materials and the stagnation of production and delivery, resulting in the failure of timely delivery of some orders, affecting revenue recognition; The epidemic broke out in Jilin, Shanghai and some other cities, which greatly affected the local business development; In addition, affected by multiple factors such as customer demand and intensified market competition, the operating revenue increased only slightly in the first quarter of 2022.
Based on the long-term perspective, the investment will continue to increase, and the transformation determination will not change in the short-term pain. In the first quarter of 2022, the company's three expenses increased by more than 20%. In terms of expense rate, the company's sales / management / R & D expense rate was 55.11% / 9.78% / 53.29% respectively, with a year-on-year increase of 8.02/1.96/9.22pct respectively. The increase of expense rate was affected by the decline of revenue growth to a certain extent. In the long run, under the overall reconstruction environment of the network security industry, the company's continuous investment without slowing down is essentially an investment in the future. With the gradual realization of social dynamic clearing in various regions, we believe that when the impact of the epidemic is gradually weakened, the company is expected to usher in the rapid realization of early investment.
Security business: the emerging product matrix is constantly improved, and business integration builds the enterprise's systematic defense capability The iteration of Sangfor Technologies Inc(300454) security business products continues to accelerate. On April 15, 2022, Sangfor Technologies Inc(300454) sase strategic upgrade, sase3 0 has three major technological innovations: all cloud native architecture, integrated architecture and high-density full security stack, providing a complete and preferred SASE solution in China at present; As one of the Sangfor Technologies Inc(300454) flagship products, the next generation firewall released a new system sangforos in late April 2022. Sangforos has financial level reliability and guaranteed product performance. At the same time, sangforos realizes the upgrading of Security Paradigm and constructs a collaborative defense system through linkage with the security platform and active defense capability. In addition, the Sangfor Technologies Inc(300454) next generation firewall integrates professional sd-wan capabilities, provides flexible cloud SASE subscription services, improves the SASE module, ensures the continuity, reliability and security of the organization's business, and makes the networking management more efficient and simple.
Cloud business: industry advantages continue to be maintained. In terms of infrastructure construction, as of March 2022, Sangfor Technologies Inc(300454) has deployed nearly 40 pop point services around the world, covering the most important first and second tier cities in China, with a total bandwidth of more than 150g, serving more than 200000 online users, and processing more than 10 billion network requests per month; According to IDC, Sangfor Technologies Inc(300454) desktop cloud terminals accounted for 41.7% of the market in 2021, ranking first in China. At the same time, the company launched a zero trust desktop cloud to help users build a secure office space available on demand. The office is unbounded and safe, and truly realize the "5A + s" level office experience Sangfor Technologies Inc(300454) can also organically integrate security capabilities into desktop cloud products and become the first product line in the short term.
Profit forecast and Valuation: we believe that 20212023 is the core stage of the company's xaas business layout. The painful period of transformation has gradually passed, and the company has been able to make a relative balance between improving product performance and apparent revenue and profit. It is estimated that in 2022, the company's products will mature iteratively, its profitability will stabilize and its profit model will run through. It is estimated that the company's revenue from 2022 to 2024 will be 9.059/11.997/16.398 billion yuan respectively, and the net profit attributable to the parent company will be 648/11.11/2.042 billion yuan respectively. Give the company a 9-11x target P / s for 2022, with a target price of 196.16-239.75 yuan, maintaining the "buy" rating.
Risk tip: business expansion is less than expected, the effect of channel construction is less than expected, and the competition in the network security industry is intensified
