\u3000\u3000 Iray Technology Company Limited(688301) (688301)
Key investment points
In 2021q4, the revenue side met expectations and the profit side slightly exceeded expectations
In 2021, the company realized an operating revenue of 1.10-1.2 billion yuan (YoY 40% – 53%), a net profit attributable to the parent company of 450-500 million yuan (YoY 102% – 125%), and a deduction of non net profit of 320-360 million yuan (YoY 61% – 81%). According to the median value, the annual revenue in 2021 is 1.15 billion yuan (YoY 47%), the net profit attributable to the parent company is 475 million yuan (YoY 114%), and the non net profit deducted is 340 million yuan (YoY 71%). In 2021q4, the revenue was 326 million yuan (YoY 42%), the net profit attributable to the parent company was 149 million yuan (YoY 124%), and the non net profit deducted was 71 million yuan (YoY 30%). The net profit attributable to the parent company in 2021 slightly exceeded our previous forecast, and the operating revenue met the expectation.
The higher than expected net profit attributable to the parent company in 2021 is mainly due to the positive correlation between Q4 government subsidies and confirmed investment income and fair value. The performance forecast shows that the amount of non recurring profit and loss in 2021 may be about 90-180 million, and the non recurring profit and loss in Q4 may reach 78 million (calculated according to the median), with an obvious increase (the non recurring profit and loss in q1-3 is 57 million yuan).
It is optimistic that the continuous release of new orders and new production capacity of the company in 2022 will bring high performance growth
We continue to be optimistic about the potential order increment brought by the company’s multiple strategic key customers during 2020-2021. We believe that dentistry and industrial security will still be the key areas of the company in the next 3-5 years. In the field of dental CBCT, the company has established preliminary cooperation with Hefei Meiya Optoelectronic Technology Inc(002690) and other head enterprises; In the industrial field, the company has obtained orders related to power battery testing from downstream new energy battery manufacturers. With the introduction and mass production of the company’s products in these major customers, and Haining factory is expected to be put into use in the first half of this year, the resonance between new orders and new production capacity may continue to lead to the rapid growth of the company’s performance from 2022 to 2023.
Profit forecast and valuation
Considering that the company’s income from changes in fair value in 2021q4 exceeded our expectations, we raised our profit forecast for 2021. We expect the company’s EPS to be 6.32, 7.43 and 10.92 yuan / share from 2021 to 2023 (the original EPS was 5.59, 7.31 and 10.86 yuan / share), and the closing price on January 18, 2022 corresponds to 61 times of PE in 2022 (42 times of PE in 2023), It is still in a relatively undervalued position and maintains the “overweight” rating.
Risk tips
The volatility of the impact of equity incentive on apparent performance, the risk of decline in gross profit margin, the risk that the sales of new products are less than expected, the risk of raw material supply, exchange risk, etc.
