\u3000\u3 China Vanke Co.Ltd(000002) 212 Topsec Technologies Group Inc(002212) )
Event:
The company issued the annual report of 2021 after the closing on April 28, 2022 and the first quarter report of 2022 after the closing on April 29, 2022.
Comments:
Stripped off the wire and cable business, and the main business of network security increased by 18.33% year-on-year
In 2021, the company’s operating revenue declined year-on-year, mainly due to the company’s implementation of major asset sales and no longer engaged in wire and cable business. The company’s network security business realized a revenue of 3.352 billion yuan, a year-on-year increase of 18.33%. After excluding the impact of Tongtian technology, the company realized a revenue of 3.313 billion yuan, a year-on-year increase of 36.42%, and the amount of new orders increased by 48.09%; The net profit attributable to the parent company was 238 million yuan, a year-on-year decrease of 52.59%. In terms of products, the revenue of basic security products, big data and situational awareness products and services, basic security services, cloud computing and cloud security products and services was RMB 2.252 billion, RMB 389 million, RMB 431 million and RMB 276 million respectively. In terms of localization, the company’s Topsec Technologies Group Inc(002212) Kunlun series localization products based on domestic software and hardware have 53 models and 168 models, keeping the leading category and model number in the shortlist of Xinchuang products. At present, products and solutions have been applied on a large scale in 23 industries such as party and government, finance, energy and transportation, with a localization business revenue of 560 million yuan, accounting for more than 15%, a year-on-year increase of nearly 10 times.
We strengthened research and development, improved the layout of new businesses, and achieved remarkable results in channel marketing strategy
In 2021, the company’s R & D expenditure was 803 million yuan, with a year-on-year increase of 47.35%, which is mainly used to consolidate the basic network security business, layout and improve the technologies and products of new directions such as data security, cloud computing, cloud security and security cloud services, situation awareness and emerging scene businesses such as industrial Internet, Internet of vehicles and Internet of things. The company’s sales expense was 719 million yuan, with a year-on-year increase of 33.56%, which was mainly used for Industry deepening, land market sinking and channel expansion. The number of sales personnel increased by 15.89%, and channel sales personnel accounted for 10.91%. The company accelerated the marketing layout of the whole industry. The operating revenue in the government industry increased by 91.26%, the financial industry increased by 69.90%, the medical industry increased by 69.34%, the political and legal industry increased by 61.60%, the operator industry increased by 59.63% and the education industry increased by 45.69%.
22q1’s operating revenue has increased rapidly, and the new scene has a leading edge
In the first quarter of 2022, the company achieved an operating revenue of 378 million yuan, with a year-on-year increase of 42.80%, mainly because the company has completed the comprehensive layout of the three major businesses of network security, big data and cloud services through early investment, especially with leading advantages in new directions and new scenarios, And some of the large new orders of the previous year (excluding the contract corresponding to the reduction of income disclosed in the amendment announcement of 2021 annual performance express) will realize income in the first quarter of 2022. The net profit attributable to the parent company was a loss of 65 million yuan and the net profit not attributable to the parent company was a loss of 71 million yuan, both of which narrowed year-on-year.
Profit forecast and investment suggestions
The company is a leading provider of network security, big data and cloud services in China. It has ranked first in China’s firewall market for 22 consecutive years. At the same time, it has actively laid out new directions and new scenes, with broad space for continuous growth. It is predicted that the operating revenue of the company from 2022 to 2024 will be 4.509, 5.892 and 7.531 billion yuan, the net profit attributable to the parent company will be 679, 893 and 1.148 billion yuan, the EPS will be 0.57, 0.75 and 0.97 yuan / share, and the corresponding PE will be 16.14, 12.27 and 9.54 times. Taking into account the growth of the company and the changes in the valuation level of the industry, the target PE of the company in 2022 is reduced to 30 times, and the corresponding target price is 17.10 yuan. Maintain the “buy” rating.
Risk tips
Covid-19 recurrent pneumonia; The implementation progress of policies related to network security and data security is less than expected; The expansion of emerging security business is less than expected; Industry competition intensifies.
