\u3000\u3 Shengda Resources Co.Ltd(000603) 466 Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) )
Event overview
According to the 2021 annual report and the first quarterly report of 2022 issued by Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) the company achieved an operating revenue of 2.94 billion yuan in 2021, with a year-on-year increase of 30.30%, and a net profit attributable to the parent company of 439 million yuan, with a year-on-year increase of 28.12%; It is proposed to distribute a cash dividend of 4.80 yuan (including tax) for every 10 shares to all shareholders. The company also released the report for the first quarter of 2022. In Q1 of 2022, the company achieved a revenue of 242 million yuan, a year-on-year decrease of 59.89%, and a net profit attributable to the parent company of – 15.78 million yuan, a year-on-year decrease of 109.96%.
The proportion of cultural business revenue increased significantly, and the overall gross profit margin decreased slightly
According to the 2021 annual report, the overall gross profit margin of the company was 32.96%, a year-on-year decrease of 1.92pct; In terms of products, during the reporting period, the revenue of urban digital experience space, cultural and brand digital experience space, digital products and services accounted for 39.70%, 58.49% and 1.81% respectively, with changes of -24.34pct, 24.08pct and 0.26pct respectively, and the gross profit margin was 35.98%, 30.23% and 54.46% respectively, with changes of 3.09pct, -6.52pct and -20.99pct respectively. The revenue of cultural and brand digital experience space accounted for nearly 60%, Become the business with the highest contribution to the company’s revenue. In terms of expense rate, the R & D rate is 3.37%, a decrease of 0.37 PCT compared with the same period last year, the sales rate is 4.86%, a decrease of 0.17 PCT compared with the same period last year, the management rate is 4.10%, a decrease of 0.55 PCT compared with the same period last year, and the financial expense rate is – 0.80%, which is – 0.96% compared with the same period last year.
The proportion of the demand for the renewal and transformation of the City Pavilion has increased, and the orders on hand have continued to be high
As of December 31, 2021, the balance of orders on hand of the company was 5.351 billion yuan, basically the same as that in the same period of 2020. In 2021, the company signed 3.597 billion yuan of new orders, an increase of 17.20% over the same period last year, including 645556 million yuan of new orders for digital products and services, a year-on-year increase of 135.21%, 2.309 billion yuan of new orders for cultural and brand digital experience space, a year-on-year increase of 12.89%, and 1.223 billion yuan of new orders for urban digital experience space, a year-on-year increase of 22.77%. According to the annual report, after more than ten years of development, the company’s urban digital experience space business has ushered in a large-scale renovation led by municipalities directly under the central government and core provincial capital cities. The proportion of income from renovation projects has significantly increased from 4.59% in 2020 to 12.15% in 2021.
Long term deep cultivation of creative production of digital content and strategic layout of meta universe business format
Relying on the advanced application experience of CG vision, rendering, AR / VR, holographic image, naked eye 3D and other digital technologies accumulated for many years, the company has benefited from the increased investment of local governments in the culture and tourism industry during the “new cultural infrastructure” and the “14th five year plan” planning cycle, continued to promote the application scene diversification strategy of digital experience business, and copied the company’s digital scene construction and immersive experience building ability to the theme museum Public cultural spaces such as museums, science and technology museums and cultural centers, as well as immersive cultural tourism experience scenes. The company has reached an ecological co construction partnership with China’s meta universe platform. Taking “urban meta universe” as the strategic development opportunity, the company expands the business of meta universe 3D virtual architecture design, rendering development and digital space operation. Zhejiang fengyuzhou, a wholly-owned subsidiary, and Xinhua news agency launched the national “two sessions” meta universe reporting activity, and created a holographic virtual stage for Hunan Satellite TV and a digital virtual anchor for Anhui Satellite TV. With the company’s forward-looking layout and innovative practice in the above fields, the company was accepted by the yuan universe Industry Committee as one of the first eight member units, and was successfully elected as the executive vice chairman unit.
Investment advice: maintain the “buy” rating
The performance of the company’s 2021 annual report was brilliant, and the revenue and net profit attributable to the parent company in the first quarter achieved negative growth, mainly due to the control of the epidemic in Shanghai, and the confirmation of projects completed and accepted in the first quarter decreased. With the gradual liberalization of control, we expect relevant projects to be completed in the next three quarters, with limited impact on the annual performance. According to the latest financial report data, we adjusted the company’s profit forecast, adjusted the forecast of 20222024 revenue of 3.611/43.76 / (unpredicted) billion yuan to 3.300/40.05/4.693 billion yuan, adjusted the forecast of 20222024 net profit attributable to parent company of 604 / 7.52 / (unpredicted) million yuan to 584 / 7.23/849 million yuan, and adjusted EPS 1.5 billion yuan 43 / 1.78 / (unpredicted) yuan is predicted to 1.38/1.71/2.01 yuan, corresponding to the closing price of 16.92 yuan / share on April 29, 2022, and PE is 12, 10 and 8 times respectively. The company benefits from the general trend of cultural digitization and high barriers to content creative production. We believe that the current stock price valuation level of the company is significantly underestimated and maintain the “buy” rating.
Risk tips
Macroeconomic fluctuation risk; Risk of loss of core technical personnel; Digital technology R & D risk.
