\u3000\u3 Guocheng Mining Co.Ltd(000688) 288 Hangzhou Hopechart Iot Technology Co.Ltd(688288) )
Main points:
Event overview
Hangzhou Hopechart Iot Technology Co.Ltd(688288) released the annual report of 2021 and the first quarter report of 2022 on April 27. In 2021, the company realized an operating revenue of 406 million yuan, a year-on-year decrease of 11.09%; The net profit attributable to the parent company was 30 million yuan, a year-on-year decrease of 66.51%; Net profit deducted from non parent company was 21 million yuan, a year-on-year decrease of 74.26%. In 2022q1, the company realized an operating revenue of 69 million yuan, a year-on-year decrease of 48.70%; The net profit attributable to the parent company was -151 million yuan, a year-on-year decrease of 171.98%; Net profit deducted from non parent company was -155 million yuan, a year-on-year decrease of 180.01%.
Terminal demand shrank and revenue and profit fell
On the revenue side, the company achieved an operating revenue of 406 million yuan in 2021, a year-on-year decrease of 11.09%; In 2022q1, the operating revenue reached 69 million yuan, a year-on-year decrease of 48.70%, mainly due to: 1) affected by the shrinking demand for infrastructure real estate terminal, the market of heavy trucks, construction machinery and other commercial vehicles was depressed, and the growth of front loading business was weak; 2) At the same time, due to the influence of covid-19 and fiscal policy, the business cycle of afterloading has been prolonged and the revenue has decreased. On the profit side, the company realized a net profit attributable to the parent company of 30 million yuan in 2021, a year-on-year decrease of 66.51%; Deduction of net profit not attributable to the parent company was 21 million yuan, a year-on-year decrease of 74.26%; The net profit attributable to Q1 was RMB 202251 billion, a year-on-year decrease of -171.1%; Net profit deducted from non parent company was -155 million yuan, a year-on-year decrease of 180.01%. Mainly due to: 1) decline in operating income; 2) The price of cost side chips and electronic materials increased and remained high; 3) Maintain high investment in R & D.
Increase R & D investment, and the results are nearly landing
In terms of R & D expenses, the R & D expense rate of the company reached 27.87% in 2021, an increase of 9.58pct over the same period last year; The R & D expense rate in 2022q1 was 41.50%, an increase of 23.76pct over the same period last year. The main reason is that the company has expanded its R & D team in order to develop chip alternatives, new projects and explore cutting-edge technologies. By the end of 2021, the company’s R & D team had expanded to 433 people, with a year-on-year increase of 38.33%. From the perspective of R & D progress, the company has achieved phased results in R & D projects in 2021, which is expected to be introduced to the market: 1) multi machine cooperation: applied to crane construction cooperation, which has reached the commercial level; 2) Automobile intelligent controller: a development agreement has been signed with the main engine factory, and the heavy truck project has achieved small batch sales; 3) Integrated navigation: the mathematical model construction, prototype design and field road test have been completed, and the real vehicle test is expected to start; 4) V2x: the company has successfully passed the large-scale conformance test of c-v2x “four spans” (Liuzhou), which proves that the product is mature and is expected to be sold on a large scale in the future.
In the past 22 years, policies have been implemented one after another to promote the recovery of the commercial vehicle market
In 2022, all localities began to formally implement the national six standards. For example, all local steel mills prohibited vehicles of national five and below from entering. In the past six months, the Ministry of Finance and other four departments issued the notice on the financial subsidy policy for the promotion and application of new energy vehicles in 2022, the notice on the comprehensive work plan for energy conservation and emission reduction in the 14th five year plan and the implementation plan for promoting green consumption issued by the State Council, which also promoted the upgrading of commercial vehicles and increased the proportion of new energy vehicles through subsidies and mandatory emission standards. According to the terminal licensing data, 2283 new energy heavy truck terminals were sold in January 2022, with a year-on-year increase of 1318%. We believe that the iteration of commercial vehicles is expected to bring market recovery and help the company improve its profitability.
Investment advice
The company attaches importance to the research and development of intelligent driving and Internet connected products and has achieved phased results. With the economic recovery and product landing, the company is expected to improve its profitability. We expect the company to achieve revenue of RMB 580 / 8.7 / 1.34 billion from 2022 to 2024, with a year-on-year increase of 43% / 50% / 54%; The net profit attributable to the parent company was RMB 0.6/0.9/140 billion, with a year-on-year increase of 104% / 49% / 59%, maintaining the “buy” rating.
Risk tips
1) R & D breakthrough is less than expected; 2) Policy support is less than expected; 3) Project delivery was less than expected.
