\u3000\u3 Guocheng Mining Co.Ltd(000688) 800 Suzhou Recodeal Interconnect System Co.Ltd(688800) )
Event:
The company released the quarterly report of 2022q1. In the first quarter, the operating revenue was 362 million yuan, with a year-on-year increase of 144.34% and a month on month increase of 19.76%; The net profit attributable to the shareholders of the parent company was 557634 million yuan, an increase of 241.11% year-on-year and 31.62% month on month; The net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses was 470535 million yuan, a year-on-year increase of 232.7% and a month on month increase of 13.04%.
Comments:
The revenue and net profit of 2022q1 reached a record high, mainly due to the increase of new energy market demand and order growth. With the expansion of the company's business scale and the strengthening of R & D, the labor cost and direct investment cost increased accordingly, and the R & D cost increased by 86.09% year-on-year. The gross profit margin was 24.97%, 0.48pct higher than that in 2021, which effectively alleviated the pressure of the sharp rise in raw materials by reducing costs and increasing efficiency. Benefiting from good period rate control, the net interest rate climbed to 15.41%, an increase of 2.79pct compared with 2021.
With connector products as the core, the company mainly serves mobile communication equipment integrators such as Zte Corporation(000063) , Ericsson and Nokia in the communication field, and the new energy vehicle field mainly serves American T company, Weilai automobile, Chongqing Changan Automobile Company Limited(000625) , Saic Motor Corporation Limited(600104) , Byd Company Limited(002594) , Contemporary Amperex Technology Co.Limited(300750) , and "three power" enterprises.
Communication field: China's 5g communication construction is slowing down, and the proportion of low-frequency base stations is increasing, which has a negative impact on the company's communication connector shipment. The company actively develops overseas markets, and the increase of overseas projects will ensure the stable development of the overall communication business.
New energy vehicles: the industry is in a period of rapid penetration. The company's automobile connector business revenue is in a leading position in China and will continue to benefit from the domestic substitution trend. With the fixed-point of new customers and new projects and the release of production capacity, the company's high-voltage connectors will continue to be in large quantities. As the main supplier of electric connector of Weilai automobile, with the growth of sales volume of electric vehicle and the popularity of power station, the sales volume of electric connector products of the company will grow rapidly. The promotion of automotive intelligence drives the application of on-board intelligent network connector. The company's relevant product development work has been completed, and the number of designated vehicle enterprises has gradually increased, forming a new performance increment.
Investment suggestions:
We predict that the company's operating revenue from 2022 to 2024 will be 1.557 billion yuan, 2.452 billion yuan and 3.414 billion yuan, with a year-on-year increase of 72.68%, 57.47% and 39.23%. From 2022 to 2024, the net profit attributable to the parent company was 207 million yuan, 347 million yuan and 507 million yuan, with a year-on-year increase of 81.82%, 67.5% and 46.15%. Comprehensive comparable company valuation, considering the large growth space of the company's new energy vehicle business, the company is given a valuation of 55 times PE in 2022, with a corresponding share price of 105.43 yuan and a market value of 11.387 billion yuan, maintaining the "buy" rating.
Risk tips:
The sales volume of new energy vehicles is less than expected, the construction of 5g communication is less than expected, the accounts receivable cannot be recovered, the inventory price falls, the price of raw materials rises, the risk of technology iteration, the epidemic control is less than expected, and the development of foreign business is less than expected.
