\u3000\u3000 Guangzhou Kdt Machinery Co.Ltd(002833) (002833)
Event: the company released the performance forecast for 2021. The annual net profit attributable to the parent company is expected to be 510-550 million yuan, and the non net profit deducted is 465-505 million yuan.
Profit growth fell in the fourth quarter. The company released the performance forecast for 2021. It is expected to realize the net profit attributable to the parent company of 510-550 million yuan and deduct the non net profit of 465-505 million yuan in the whole year, including the net profit attributable to the parent company of Q4 of 80-120 million yuan, the net profit after deducting the non net profit of Q4 of 62-102 million yuan and the non profit center of 82 million yuan, with a year-on-year increase of 2.5%. The growth rate in the fourth quarter decreased significantly.
The simultaneous weakening of internal and external needs of furniture dragged down the performance growth. Affected by China’s strict real estate regulation in the second half of 2021 and the recent gradual weakening of overseas demand, the growth rate of China’s furniture retail sales and the export amount of furniture and its parts decreased by 3.1% and 3.9% respectively year-on-year in December 2021, and the two data increased by 3.4% and 16% year-on-year in September 2021. The simultaneous weakening of internal and external demand for furniture dragged down the company’s performance growth.
The inflection point of the policy has come, and the company benefits from furniture subsidies to the countryside and affordable housing construction. Recently, the national development and Reform Commission encouraged rural residents to upgrade their consumption and implement subsidies for furniture and home decoration to the countryside. At the same time, the Political Bureau meeting pointed out that “we should promote the construction of affordable housing and support the commercial housing market to better meet the reasonable housing needs of buyers”. Furniture subsidies to the countryside and the promotion of affordable housing construction are good for second-line or secondary first-line furniture enterprises with cost performance. Such furniture equipment generally uses Chinese panel furniture equipment such as Hongya and Nanxing. In addition, supporting the commercial housing market to better meet the reasonable housing needs of buyers is expected to alleviate the cash flow problem of furniture enterprises and drive the recovery of capital expenditure of furniture enterprises.
Capacity improvement + high-end products, the company seizes market share at home and abroad. The company is promoting the construction of new production capacity. Shunde Longjiang 160000 square meter production base is expected to be completed in the second half of 2023. In three years, the company’s total production capacity will meet the revenue of at least 5 billion yuan. In recent years, the company’s products have gradually become high-end, and the gap with the global leader Germany Haomai has gradually narrowed. From 2016 to 2018, almost all the mainstream equipment of the head furniture company were foreign brands. At present, the company’s products have entered most Chinese head furniture brands and built intelligent production lines for several of them. The price of the company’s products is only 1 / 3-1 / 2 of that of German Haomai. In the future, the gradual production of the company’s new production capacity will help the company continue to improve its market share, open up the space of overseas market and gradually replace foreign brands. At present, the company’s global market share is about 7%, and its revenue is only 1 / 4 of that of Haomai in Germany, so there is still much room for growth.
Profit forecast and investment rating. Affected by the real estate industry, we lowered the company’s profit forecast. After adjustment, it is expected that the company’s EPS will be 1.78 yuan, 1.93 yuan and 2.89 yuan respectively from 2021 to 2023, and the corresponding PE will be 18.9 times, 17.4 times and 11.6 times respectively. Considering the sharp correction of stock price in advance and the inflection point of real estate policy, it is expected that the furniture industry will pick up in the second half of 2022, we maintain the “buy” rating of the company.
Risk tip: the steady growth policy is less than expected, the recovery of real estate investment, sales and completion is less than expected, and the leading edge of technology is weakened or less than expected.
