\u3000\u3 Guocheng Mining Co.Ltd(000688) 696 Chengdu Xgimi Technology Co.Ltd(688696) )
Event:
On April 28, 2022, Chengdu Xgimi Technology Co.Ltd(688696) released the first quarterly report of 2022. In 2022q1, the company achieved a revenue of 1.013 billion yuan (+ 24.32%) and a net profit attributable to the parent company of 121 million yuan (+ 35.77%).
Key investment points:
Smart projection continued its high boom, and its revenue increased rapidly in 2022q1. 1) Domestic sales: the intelligent projection category has double-digit growth, and the company’s revenue growth has outperformed the industry. According to Lotu technology data, the sales volume of China’s intelligent projection market in 2022q1 is 2.64 billion yuan (+ 12.3%). According to magic mirror data, the revenue of the company’s intelligent projector on tmall Taobao and jd.com platforms in 2022q1 was 840 million yuan (+ 17.76%), with a growth rate leading the industry. 2) Overseas: according to our calculation, the overseas revenue in 2022q1 increased by 60% year-on-year. We judge that the growth rate is beautiful or the new overseas products Horizon Series and elfin continue to drive the rapid growth of revenue.
Further improve profitability and continue to increase R & D investment. 1) Gross profit margin: the gross profit margin in 2022q1 is 37.79% (+ 2.57pct). We believe that the further optimization of the company’s product structure may drive the upward movement of the price center. 2) Net profit margin: the net profit margin of 2022q1 is 11.99% (+ 1.01pct), which is lower than the gross profit margin, mainly because the company continues to increase R & D investment. The ratio of sales / R & D / management expenses of 2022q1 company was 13.70% / 9.26% / 3.52% respectively, with a year-on-year increase of 0.11/3.30/0.57pct.
Domestic product innovation + overseas channel empowerment to consolidate the leading position of intelligent projection. 1) Product side: z6xpro is launched in 2022q1 with outstanding cost performance, which is expected to continue the high popularity of newz6x. We look forward to the excellent sales performance of 2022q2 in the 618 promotion season. 2) Channel side: actively cover offline channels such as overseas local chain retail groups and regional distributors. In the Japanese market, the company plans to acquire Shanghai Aladdin Biochemical Technology Co.Ltd(688179) business held by popin Co., Ltd. after completion, the company will integrate Shanghai Aladdin Biochemical Technology Co.Ltd(688179) complete business chain, which will help to better control the channels of the Japanese market.
The company’s leading position in the intelligent projection industry is stable, its profitability continues to increase, and maintains the “buy” rating. Smart projection has a high boom. With the improvement of smart projection penetration and overseas market development, the company’s performance is expected to continue to grow rapidly and maintain the “buy” rating. We predict that from 2022 to 2024, the net profit attributable to the parent company will be RMB 666 / 912 / 1215 million, the corresponding EPS will be RMB 13.33/18.24/24.30, and the current share price will be 28.07/20.51/15.40 times PE.
Risk tips: shortage of chip supply, repeated covid-19 epidemic, intensified industry competition, rising raw material prices, uncertainty of the company’s overseas business development, lifting of the ban on restricted shares, etc.
