\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 845 Shanghai Baosight Software Co.Ltd(600845) )
Core view
Steady growth in the first quarter and excellent cash flow performance. In the first quarter of 2022, the company realized a revenue of 2.498 billion yuan, an increase of 23.76% after adjustment; The net profit attributable to the parent company was 455 million yuan (+ 12.68%); Deduct the net profit not attributable to the parent company of 441 million yuan (+ 20.03%). The company’s net cash flow from operating activities was 1.046 billion yuan (+ 141.31%), which was mainly due to the company’s continuous improvement of working capital management, the cash received from sales in the current period was higher than that in the same period last year, and the cash received from the sale of goods and the provision of labor services was higher than that in the same period last year. The company’s inventory reached 3.098 billion yuan, a slight increase; Contract liabilities reached 3.824 billion yuan, a year-on-year increase of 18%; All indicators remain healthy. The gross profit margin remained stable compared with last year, and the expense rate increased. The company’s 22q1 gross profit margin was 32.42%, basically the same as last year, with a year-on-year decrease. It is expected that the iron and steel informatization and automation business will grow rapidly, and IDC phase V will enter the rhythm of continuous delivery. In terms of expense rate, the rates of sales, management and R & D expenses increased by 33.04%, 20.92% and 4.79% respectively. The higher increase in sales expenses was mainly due to the increase in sales expenses in consolidated statements due to the non co controlled acquisition of Gangdi electric at the end of December 2021.
It plans to acquire 51% equity of TISCO Xinzi to further integrate the steel information industry. The company plans to purchase 51% equity of TISCO Xinzi by cash payment, with a consideration of no more than 10.51 million yuan. Before this transaction, Shanghai Baosight Software Co.Ltd(600845) and TISCO letter belong to the same actual controller, and the business overlap is high. TISCO has long served TISCO group and other relevant regional customers. Baoxin’s acquisition is similar to that of Pegasus Zhike and Wuhan Industrial Technology in the early stage. Since 2021, TISCO’s revenue has been 112 million yuan and its net profit has been 2.82 million yuan; In the first quarter of 2022, the revenue was 30.78 million yuan and the net profit was 2.74 million yuan. In this acquisition, Shanghai Baosight Software Co.Ltd(600845) further integrates it companies in the iron and steel industry and thickens the company’s performance.
With the acquisition of Baowu, Baoxin’s information business has grown rapidly. Since 2019, Baowu group has successively reorganized many large iron and steel companies such as Maanshan Iron and Steel Group, TISCO group and Chongqing Iron & Steel Company Limited(601005) etc. after achieving the goal of “100 million tons of Baowu”, Baowu group will strive to reach 200 million tons of crude steel by 2025. As a leader in Intelligent Manufacturing in the iron and steel industry, Baowu has continuously increased the demand for informatization and automation of newly merged steel enterprises under the requirements of “centralized and consistent”. In 2022, Baoxin’s guidance on related party transactions reached 9.1 billion yuan, an increase of 44% over the guidance of 21 years. Meanwhile, Baoxin continues to expand in the field of industrial software. Xinplat, the company’s industrial Internet platform, has been selected as a double cross platform again. By the end of 2021, a total of 28 platform nodes have been built. The platform has connected 4 + million devices, 6000 + industrial models and 7000 + industrial apps, covering 17 industries. It has more than 50 solutions in 9 fields and serves more than 290000 enterprise users.
Risk tip: the expansion of IDC is less than expected, the growth of steel informatization slows down, and the impact of the epidemic intensifies.
Investment advice: maintain the “buy” rating. It is estimated that the operating revenue from 2022 to 2024 will be 152.17/195.12/246.11, with growth rates of 29% / 28% / 26% respectively, and the net profit attributable to the parent company will be RMB 2.500/3.208/3.959 billion, corresponding to 28 / 22 / 18 times of the current PE, maintaining the “buy” rating.
