\u3000\u30 Xuchang Ketop Testing Research Institute Co.Ltd(003008) 33 Guangzhou Haoyang Electronic Co.Ltd(300833) )
1. Company introduction: it is a leader in the field of stage lighting equipment and has excellent performance
The company is a high-tech enterprise integrating the R & D, production and sales of stage entertainment lighting equipment, architectural lighting equipment and trusses. Stage lighting and entertainment equipment is the company's largest business. In 2021, the operating revenue of stage lighting equipment accounted for 88.77%. The stage lighting equipment produced by the company is widely used in large-scale performance activities and well-known buildings at home and abroad, including the opening and closing ceremony of the 2008 Beijing Olympic Games, the Tiananmen Square celebration of the 60th anniversary of the National Day in 2009, the 2012 London Olympic Games, etc.
The company's performance maintained stable growth. The growth rate of the company's operating revenue basically remained above 10%. Affected by the epidemic in 2020, the operating revenue decreased, but it rebounded rapidly in 2021, with a year-on-year growth rate of 54.66%; The company's profitability is excellent. The gross profit margin over the years has been maintained at more than 40%, and the net profit margin over the years is generally higher than 15%. In the first quarter of 2022, the company's sales gross profit margin reached 48.43%, and the sales net profit margin reached 26.83%; The overall period cost of the company is low and shows a downward trend. Since 2016, the period cost rate has been about 20%.
2. Recommendation logic: covid-19 pneumonia epidemic situation is improving, and there is a wide growth space in the future
1) the improvement of the epidemic situation drives the growth of downstream demand. Before the outbreak of covid-19, the performance and entertainment industry outside China maintained a stable growth trend. The outbreak of the epidemic has hit the performance and entertainment industry at home and abroad to a certain extent. With the improvement of the epidemic situation, the performance industry at home and abroad has warmed up in the past 21 years, driving the downstream demand growth of the stage lighting equipment industry.
2) the growth of China's cultural and entertainment consumption demand drives the development of China's stage lighting equipment industry. With the development of China's national economy, the level of residents' disposable income continues to grow rapidly, which is expected to lead to consumption upgrading and promote the growth of China's cultural and entertainment consumption demand. With the continuous improvement of the epidemic situation in China, it is expected that there will be greater growth space for China's entertainment consumption demand in the future, which will benefit the stage lighting equipment industry.
3) open the market through OBM and ODM modes. On the one hand, the company cooperates with internationally renowned professional stage lighting enterprises through ODM Sales Mode to explore overseas markets; On the other hand, through the acquisition of Arden, France, and the creation of its own brand "terbly", the layout of OBM and the development of markets outside China.
4) pay attention to scientific and technological research and development, brand construction and talent training. Since its establishment, the company has always attached importance to technological innovation, maintained R & D investment, and has a number of patented technologies and high-tech products. In addition, it also establishes strategic cooperation with universities, colleges and research institutes, and establishes various talent reserves.
3. Profit forecast and investment suggestions
It is estimated that the company's operating revenue from 2022 to 2024 will be 1008 million, 1447 million and 1937 million respectively, and yoy will be 63.11%, 43.52% and 33.86%; The net profit attributable to the parent company is 250 million, 364 million and 502 million respectively, and yoy is 83.66%, 45.86% and 37.87%, corresponding to PE 28x, 19x and 14x. We are optimistic about the company's core competitiveness in the industry. The target market value is 9.034 billion yuan and the corresponding target price is 107.13 yuan. It is covered for the first time and given a "buy" rating.
Risk tips: covid-19 epidemic continued impact risk, international trade friction risk, loss of core technical personnel and disclosure risk of core technology, exchange rate fluctuation risk and business model risk.
