\u3000\u3 China Vanke Co.Ltd(000002) 705 Guangdong Xinbao Electrical Appliances Holdings Co.Ltd(002705) )
Event: the company issued the draft employee stock ownership incentive plan for 2022. The company issued the draft employee stock ownership incentive plan for 2022 on the evening of May 20. The maximum amount of funds to be raised in this employee stock ownership plan is 70 million yuan, and the number of shares is no more than 7.66 million, accounting for 0.93% of the total share capital of the company. The stock source is the company’s repurchased shares, and the purchase price is 9.07 yuan / share (50% of the average trading price of the company’s shares on the trading day before the publication of the draft plan). As of May 20, 2022, Guangdong Xinbao Electrical Appliances Holdings Co.Ltd(002705) closing price is 18.32 yuan / share. The number of holders of this ESOP is expected to be no more than 26, including 6 company executives and 20 other core managers.
The employee stock ownership plan has a large profit margin, which aims to improve the benefit sharing mechanism of the company. The employee stock ownership plan is unlocked in two phases, and only performance assessment objectives are set: 1) the net profit attributable to the parent company in 2022 will not be less than 871 million yuan; 2) The accumulated net profit attributable to the parent company in 2022 and 2023 shall not be less than 1.829 billion yuan. The net profit assessed by the company is calculated based on the amount of net profit attributable to the parent plus the impact of share based payment expenses. Based on the net profit attributable to the parent company in 2021, after reducing the impact of share based payment, the company’s performance evaluation goal is that the growth rate of the performance end from 2022 to 2023 will not be less than 7.1% / 9.4%. In terms of unlocking method, if the company’s performance in the first unlocking period does not meet the standard, the corresponding equity can be deferred to the second unlocking period. If the company’s performance still fails to meet the standard in the second unlocking period, the corresponding rights and interests shall not be exercised. We believe that the company’s performance goal is low and the unlocking method is flexible, which is conducive to better bind the interests of the company and core employees.
The company’s export growth in 2022q1 exceeded expectations, and domestic sales were under short-term pressure due to the impact of the epidemic. The company recently released the first quarterly report of 2022, with revenue and performance increasing by 13.5% / 4.6%. On the revenue side, Q1’s domestic and export sales increased by 3% / 17% in a single quarter. Among them, export sales still achieved a high growth under the high base in the same period (the export revenue of 21q1 increased by 71%). Domestic sales were blocked by the repeated epidemic in March, and the revenue was under short-term pressure.
2022q2 epidemic is expected to improve, and the company ushers in high performance flexibility. The company’s export sales accounted for a high proportion. In 21q2, affected by the rise of raw material prices, the rise of sea freight costs and the appreciation of RMB exchange rate, the gross profit margin decreased by 10.89pct to 16.51% and the performance decreased by 52.96% to 144 million yuan. In terms of 22q2, the revenue side expects the company’s export orders to stabilize, and the domestic sales are expected to increase month on month under the expectation of the improvement of China’s logistics. On the cost side, external factors have improved marginally. At present, the growth of raw material prices and shipping costs is slowing down, and the RMB exchange rate has depreciated rapidly since May. Based on the above factors, we judge that the company’s 22q2 performance is flexible. We calculate that under optimistic / pessimistic expectations, the company’s Q2 performance is expected to increase by 29.95% / 21.42% at the same time Profit forecast and investment suggestions. We expect that the net profit attributable to the parent company in 202224 will be RMB 992 / 1146 / 1321 million respectively, with an increase of 25.2% / 15.5% / 15.3% at the same time, maintaining the “overweight” rating.
Risk tip: the export boom is declining, the macro economy is weak, and the expansion of new products is less than expected
