\u3000\u3 Guocheng Mining Co.Ltd(000688) 696 Chengdu Xgimi Technology Co.Ltd(688696) )
Event: Chengdu Xgimi Technology Co.Ltd(688696) released the first quarterly report of 2022. The company achieved revenue of 1.01 billion yuan in the first quarter of 2022, yoy + 24.3%; Achieved performance of 120 million yuan, yoy + 35.8%. The repeated epidemic has had a certain negative impact on logistics and offline channel sales. The tight supply of chips has restrained the supply of projectors. Under the multiple pressures of the external environment, Jimi Q1’s single quarter revenue maintained rapid growth and its profitability remained stable. If the external environment improves in the future, the company’s operation is expected to improve marginally.
Affected by the external environment, the growth rate of household projectors slowed down month on month: the income growth rate of polar meters in 2022q1 was higher than that in 2021q4-21pct. We believe that the main reasons are: 1) the epidemic has repeatedly affected offline channels and logistics, and the company’s domestic sales revenue has been negatively affected; 2) Chip supply is still in a relatively tight state, and the company’s revenue growth in the short term is mainly driven by price increase. According to Lotu data, the sales volume of 2022q1 polar meter projector is yoy + 14% (sales volume is yoy-2%, average price is yoy + 17%).
The gross profit margin of Jimi Q1 increased year-on-year: in 2022q1, the gross profit margin of Jimi Q1 was 37.8%, year-on-year + 3.8pct. We think it is mainly due to the continuous improvement of the company’s product structure, and the average online sales price of 2022q1 is yoy + 17% (Lotu). The average selling price of 2021q1 / 2021q2 / 2022q1 polar rice line is 3315 yuan / 3834 yuan / 3865 yuan respectively. If the product structure of 2022q2 is similar to that of 2022q1, the year-on-year increase of average price will be narrowed.
The net profit rate attributable to the parent company of Jimi Q1 increased year-on-year: the net profit rate attributable to the parent company of Jimi Q1 in 2022q1 was 12.0%, year-on-year + 1.0pct. Excluding the impact of non recurring profits and losses, the non net profit rate deducted by the company in Q1 was 10.1%, year-on-year -0.6pct. In Q1, the company’s sales expense rate in a single quarter was + 1.4pct year-on-year, and the gross sales difference was + 2.5pct year-on-year. The decrease of non net profit margin is mainly due to the increase of management and R & D expenses. Q1 in a single quarter, the company’s management expense rate was + 0.6pct year-on-year, and the R & D expense rate was + 3.3pct year-on-year. We believe that it is mainly due to the increase of the company’s share based payment expenses.
In Q1, the company’s cash flow from operating activities decreased: in 2022q1, the net cash flow from Jimi’s operating activities was – 140 million yuan, a year-on-year increase of – 200 million yuan. The cash paid by Jimi Q1 for purchasing goods and receiving labor services in a single quarter was yoy + 70%, and the growth of cash outflow scale was faster than that of operating cost. We believe that in order to prepare for the 618 promotion, the company has stepped up the preparation of goods. The inventory of 2022q1 company is 1.05 billion yuan, a year-on-year increase of + 310 million yuan.
Investment suggestion: Jimi is the leader in China’s projector industry. The company’s products and channels are continuously optimized and its profitability is improved. The company has made greater efforts to expand overseas markets and is expected to achieve rapid growth in the dividend period of the industry. We expect that the EPS of Chengdu Xgimi Technology Co.Ltd(688696) 2022 ~ 23 will be 12.08/18.25 yuan, maintaining the investment rating of buy-a.
Risk warning: technology R & D risk, increased market competition risk, and dependence on outsourcing of core parts
