\u3000\u30 Beijing Telesound Electronics Co.Ltd(003004) 08 Chaozhou Three-Circle(Group) Co.Ltd(300408) )
2022q1 performance exceeded expectations and maintained the "buy" rating
In 2022q1, the company achieved a revenue of 1.402 billion yuan, a year-on-year increase of + 7.1%, and a net profit attributable to the parent company of 498 million yuan, a year-on-year increase of 1.6%, deducting a non net profit of 420 million yuan, a year-on-year increase of + 0.1%, exceeding market expectations. We maintain the previous profit forecast. It is estimated that the company's net profit attributable to the parent company from 2022 to 2024 will be RMB 2.483/30.99/3.826 billion, EPS will be 1.30/1.62/2.00, and the corresponding PE of the current stock price will be 19.0/15.2/12.3 times. We are optimistic about the strong competitiveness of the company as a ceramic material platform in the field of components, communication components and semiconductor components. The current valuation is at the lower limit of the company's historical valuation range and maintains the "buy" rating.
The revenue and profit have achieved positive growth year-on-year, and pay attention to the change of inventory level
In the first quarter, the company overcame the impact of the epidemic and weak consumption, and achieved positive growth in revenue and profit year-on-year. Among them, the revenue increased by 7.1% year-on-year, the net profit attributable to the parent increased by 1.6% year-on-year, and the deduction of non net profit increased by 0.1%. The gross profit margin in 2022q1 was 49.4%, an increase of 8.5 percentage points over 2021q4, better than 48.6% in 2021q3, and a slight decrease of 2.0pcts year-on-year in 2021q1. The cash flow performance was excellent, with a net operating cash flow of 473 million, higher than 395 million yuan in the same period in 2021. Affected by the epidemic and weak consumer demand, the inventory level is high and the turnover rate of fixed assets is low. Among them, the inventory turnover days in the first quarter were 247.8 days, and the data in the single quarter hit a record high; The turnover rate of fixed assets was 32.7%, lower than 52.9% in 2021q1 and 42.7% in 2021q4, a new low in recent three years. On the one hand, affected by the weakening demand, on the other hand, the company actively expanded production, and the fixed assets were increasing significantly (from 188.7 billion yuan in 2019q1 to 428.3 billion yuan in 2022q1).
Expand against the trend and continue to expand and strengthen MLCC
Chinese terminal manufacturers have strong demands for independent control of basic components. The company actively responds to the demands of terminal manufacturers and makes full efforts to MLCC business. The company's fixed growth plan has been successfully issued in 2021. The high capacity MLCC project plans to invest 3.75 billion yuan to raise funds. The project is expected to achieve an annual output of 300 billion high capacity MLCCs. The project is conducive to the company to continue to expand and strengthen the MLCC business. It is expected that after the project is completed, the total production capacity of the company will exceed 50 billion pieces / month, and the scale will catch up with Murata, Samsung and other overseas leading enterprises.
Risk warning: weak demand; MLCC price decline risk; Limited capacity release of the company.
