\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 80 Wuxi Longsheng Technology Co.Ltd(300680) )
Event overview
The company released the first quarterly report of 2022: in 2022q1, the company achieved a revenue of 286 million yuan, a year-on-year increase of + 42.6%, a month on month increase of - 8.2%, a net profit attributable to the parent company of 29 million yuan, a year-on-year increase of + 36.4%, a month on month increase of + 9.3%, and a net profit not attributable to the parent company of 28 million yuan, a year-on-year increase of + 33.7%, a month on month increase of + 34.1%.
Analysis and judgment:
Accelerated growth of new energy and new breakthroughs in hybrid
Revenue side: in 2022q1, the company achieved a revenue of RMB 286 million, with a year-on-year increase of + 42.6%. It is expected to mainly benefit from the increase of motor iron core shipments, with a month-on-month increase of - 8.2%, which is in line with the fluctuation law of Q1 over the years. However, it is expected that it is still partially affected by the decline in the production and sales volume of light truck industry (the output of light truck in 2022q1 is 467000, with a year-on-year increase of - 19.9% and a month-on-month decrease of - 9.1%), resulting in the insufficient release of the incremental contribution brought by the Sixth.
Profit side: the overall gross profit margin of 2022q1 company is 21.3%, with a year-on-year increase of -3.9pct. It is expected to be mainly affected by the rise of raw material prices, but it is + 2.2pct month on month, showing an improvement trend. During the period brought by the growth of the company's revenue and the decline of R & D rates, the net profit attributable to the parent company in 2022q1 reached 29 million yuan, with a year-on-year increase of + 36.4% and a month on month increase of + 9.3%, which was in the midstream range of the early performance forecast, deducting 28 million yuan of non attributable net profit, with a year-on-year increase of + 33.7% and a month on month increase of + 34.1%.
Expense side: the sales, management, R & D and financial rates of 2022q1 company are 1.1% / 3.8% / 3.8% / 1.2% respectively, with a year-on-year rate of - 1.6, - 0.7, - 0.4 and + 0.3pct respectively. With the growth of revenue and R & D rates, there is a downward trend.
Looking forward to the whole year of 2022: the company will simultaneously usher in two aspects of catalysis: 1) EGR business: the contribution of light truck EGR of more than 3.5t to the company will be extended to the whole year. At the same time, the incremental contribution brought by heavy truck and hybrid EGR (designated by two platform projects of China's leading hybrid vehicle enterprises) will form a strong support for EGR business; 2) The company's iron core shipment volume is expected to further increase to about 1.5 million sets in 2022, which is expected to boost the company's output of iron core.
Traditional main business focuses on EGR country VI upgrade bonus period
The company's traditional main business focuses on the EGR sector, focusing on three core products: EGR valve, cooler and throttle. The market share of the company in phase IV of China was once maintained at a high level, but the EGR business in phase V of China was under short-term pressure due to the adjustment of technical route. With the comprehensive switching of national VI emission standards from 2021, the EGR sector will usher in a period of rapid growth of policy dividends: 1) light truck: the main source of increment is more than 3.5t. Based on the original customer resources and technical advantages, the market share of the company is expected to reach 60%; 2) Heavy truck: the epidemic situation and Sino US friction accelerate domestic substitution. The company is expected to seize part of the market with its deep technical accumulation, and some customers are in the performance test stage; 3) Others: the fourth phase emission standard for non road mobile vehicles will be implemented from December 1, 2022, and is expected to contribute to the increment from 2022q4; The company pursues the strategy of developing both gasoline and diesel, and deeply explores the EGR market of hybrid vehicles. At present, it has been designated as the two platform projects of China's leading hybrid vehicle enterprises. It is expected to usher in a large amount in 2022 and continue to benefit from the penetration of hybrid vehicles.
Strategic layout new energy continues to benefit from the trend of vehicle electrification
The motor iron core is equipped with high-quality customers, and the acceleration of large-scale production is imminent. In 2018, the company acquired micro research precision, fully coordinated with market, technology and R & D, and successfully extended its business scope to the field of new energy vehicle drive motor iron core. At present, it has officially become a first-class supplier of a foreign electric vehicle and energy company. It began mass production in May 2021 and indirectly supported vehicle enterprises such as Weilai, SAIC, Chery, ideal and great wall through United Automotive Electronics, Lay a solid foundation for the subsequent expansion of the iron core industry. In the medium and long term, we believe that the company will continue to benefit from the rapid growth of the industry and high-quality customer resources under the trend of automobile electrification, and there are opportunities for the company to penetrate into other high-end motor core applications in the long term.
Natural gas injection system is bound with Bosch, the third performance growth point. Since October 2017, the company has jointly developed the "natural gas injection system" project with Bosch. In October 2019, the company was appointed by Bosch supplier to undertake the manufacturing of core component "high flow natural gas nozzle" to the supporting business of natural gas injection system assembly. In October 2020, the company officially entered the stage of small batch production. In line with the general trend of natural gas as alternative fuel in the commercial field, the natural gas injection system officially entered the stage of mass production in 2021.
Investment advice
The company has been deeply engaged in EGR business for many years, and the three core products of EGR valve, cooler and throttle are expected to increase rapidly in phase VI in China; High quality customers supporting motor iron core continue to benefit from the trend of automobile electrification; The natural gas injection system is bound to Bosch. Maintain the profit forecast. It is estimated that the company's revenue from 2022 to 2024 will be RMB 1.963/29.16/3.840 billion, the net profit attributable to the parent company will be RMB 213/3.38/454 million, the EPS will be RMB 1.05/1.68/2.25 respectively, corresponding to the closing price of RMB 17.28/share on April 28, 2022, and the PE will be 16 / 10 / 8 times respectively, maintaining the "buy" rating.
Risk tips
The market share of EGR products in phase VI in China is lower than expected; The sales volume of commercial vehicles in China is lower than expected; The penetration of Shanxi Guoxin Energy Corporation Limited(600617) vehicles in the world and China is lower than expected; The expansion of new energy business was lower than expected.
