\u3000\u3 Shengda Resources Co.Ltd(000603) 712 Tianjin 712 Communication & Broadcasting Co.Ltd(603712) )
Key investment points
Company announcement: the company released the annual report of 2021 and the first quarterly report of 2022. In 2021, the company achieved a revenue of 3.451 billion yuan, a year-on-year increase of 28.00%, a net profit attributable to the parent company of 688 million yuan, a year-on-year increase of 31.58%, and a deduction of non attributable net profit of 648 million yuan, a year-on-year increase of 29.29%. In 2022q1, the company achieved a total operating revenue of 410 million, a year-on-year increase of 18.2%, and a net profit attributable to the parent company of 21.489 million, a year-on-year increase of 26.7%.
The performance maintained steady growth and there were sufficient orders on hand. Benefiting from the construction of national defense informatization, the performance of the company continued to grow steadily in 2021 and 2022q1. In terms of business, the company's wireless communication terminals and system products achieved revenue of 2.465 billion yuan and 823 million yuan respectively, with a year-on-year increase of + 67.74% / - 24.37% respectively. Among the wireless communication terminals, the orders of traditional on-board products were stable, new breakthroughs were made in the market expansion of new generation ultrashort wave communication products, single soldier terminals and new architecture weapon platform communication products, and batch orders were made for traditional on-board terminal products, satellite communication and satellite navigation products. The year-on-year decline of system products was mainly affected by the rhythm of order delivery. The annual comprehensive gross profit margin was 47.59%, down 0.53 PCT year-on-year, of which the gross profit margin of system products fell 4.24 PCT year-on-year, and the gross profit margin of wireless communication terminal products increased slightly. In terms of expenses, the company's sales / management / financial expense ratio was 1.97% / 5.29% / 0.22% respectively, with a year-on-year increase of -0.17 / + 0.54 / - 0.24 PCT respectively. The increase in management expenses was mainly due to the fact that the state no longer enjoyed the national social security exemption policy. At the same time, in order to create a market-oriented competition mechanism, the salary standard of employees was optimized and adjusted. In terms of business, the company continues to focus on military products business, adjust organizational structure, optimize resource allocation and improve the overall production and delivery capacity. The company has sufficient orders for military products on hand. As of 22q1, the contract liabilities were 1.308 billion yuan, accounting for 37.9% of the revenue in 2021.
Focus on the main business of military communications, and open up long-term development space for new products. China's national defense has basically realized mechanization, and will be upgraded to informatization in the next stage. China's military expenditure is expected to be 45.2 trillion yuan in 2021, a year-on-year increase of about 1.2%. As the core field of national defense informatization, the proportion of related equipment procurement will continue to grow steadily. The company is a leading enterprise in China's military communications, with complete scientific research and production qualifications, continuously strengthened the bidding and sales capacity of various military services, and steadily increased the share of equipment in traditional fields. In the field of aeronautical communication, the company won the first prize for its new integrated system products, which are expected to be popularized and applied on a variety of aircraft platforms in the future; The project of a certain type of information technology deputy chief engineer unit was successfully bid, and the overall ability of the system reached a new level; The training evaluation system extends to multiple aviation platforms. Traditional airborne terminal products and satellite communication and satellite navigation products have obtained batch orders, and the market share of data link products has continued to increase; The order quantity of new communication navigation identification system and training evaluation system has increased steadily. In the field of ground communication, an improvement and improvement project covering handheld, backpack, vehicle and other platform products has gradually completed the train loading and finalization, entered the state of small batch production, and started the project approval and development of the next generation products.
Maintain high R & D investment and consolidate the leading edge of private network communication technology. In 2021, the company's R & D expenditure was 775 million yuan, with a year-on-year increase of 34.17%, accounting for 22.47% of the current revenue., The company continues to promote the reform of scientific research system and build a more efficient innovation platform to improve R & D efficiency. In the field of military wireless communication, after realizing the network construction, the current tactical communication system is developing towards the direction of multi-modal, comprehensive and land, sea, air and space integration of reconnaissance, reconnaissance, exploration, communication, guidance and knowledge. It is necessary to build a multi-means, multi-level and three-dimensional comprehensive communication system. The company focuses on the pre research and bidding of the next generation of ground and aviation equipment, integrated system, integrated data link, satellite communication equipment and Beidou three generation typical application system, accelerates the delivery, landing and trial guarantee of cross production and research finished products, actively expands the new product market, guides customers' needs with cutting-edge technology, and obtains a broader market space. In terms of civil communication, the private network communication industry is developing towards the trend of broadband and digitalization. The company closely follows the next generation communication system, focusing on the development of 5g equipment for locomotive integrated wireless communication, 5g based urban rail transit dispatching communication system, lte/5g dispatching communication system based on public network, digital train dispatching and other projects, and has completed the product development of many projects, such as railway communication miniaturization locomotive platform, medium and old railway locomotive integrated wireless communication equipment, Continue to strengthen the company's core competitive advantage in the private network field.
Investment suggestion: with the launch of China's national defense informatization construction in the 14th five year plan, the military informatization construction is expected to develop rapidly. The company is a leading military wireless communication enterprise in China. It has achieved full military coverage and is expected to enjoy the dividends brought by the high prosperity of the industry. Considering the impact of short-term delivery rhythm, we adjusted the profit expectation. It is estimated that the net profit of the company from 2022 to 2024 will be 888 million yuan / 1154 million yuan / 1501 million yuan respectively (the original forecast from 2022 to 2023 was 1.028 billion yuan / 1.414 billion yuan), and the corresponding EPS will be 1.15 yuan / 1.5 yuan / 1.94 yuan respectively. Maintain the "buy" rating.
Risk warning: the growth of military expenditure is less than expected; The investment in railway construction is less than expected; Risk of shareholders' reduction; There may be a risk that industry data and information may lag behind or not be updated in time
