Grg Banking Equipment Co.Ltd(002152) comment report: the establishment of a digital economy investment and operation company has accelerated the development of urban intelligent business

\u3000\u3000 Grg Banking Equipment Co.Ltd(002152) (002152)

Event: on the evening of January 20, the company announced that in order to increase the resource investment and layout of urban intelligent sector, the company plans to establish a wholly-owned subsidiary radio and television digital economy investment and Operation Co., Ltd. (hereinafter referred to as “radio and television digital investment”), with a registered capital of 1 billion yuan.

Key investment points:

Increase the investment of urban intelligent business resources and clarify the two wheel drive strategy: urban intelligence is an important business scenario for the implementation of the company’s AI + strategy. This time, radio and television digital investment is specially set up, which once again clarifies the strategic picture of the two wheel drive of the company’s financial technology and urban intelligence. The company’s urban intelligent business fully covers application scenarios such as intelligent transportation, intelligent security, intelligent government affairs, intelligent education and intelligent retail, realizes the fine and intelligent management of urban data and information, and has created a series of benchmark projects. With the company’s increasing investment in resources from the urban intelligent sector, the business is expected to become a new engine for the company’s development.

Urban intelligence and financial technology are integrated with two wings and take off by the east wind of Digital Economy: the company comprehensively and deeply builds digital economy business. In terms of digital government affairs, the company cooperates with relevant government agencies, enterprises and institutions to extend and expand urban comprehensive businesses such as urban brain, smart parking and smart policing, so as to help the government improve urban comprehensive governance capacity and service level. In the field of digital RMB, the company has the ability to build the whole digital RMB link, and has a layout in terms of intelligent digital currency machines and tools, digital currency system platform and digital currency scenario operation. The radio and television digital investment set up this time will serve as the company’s investment and operation platform to carry out the investment, construction and follow-up operation of digital economy business nationwide, which will help the company seize the development opportunity of digital economy during the 14th Five Year Plan period and comprehensively expand the business territory of financial technology and urban intelligence.

Profit forecast and investment suggestions: it is estimated that the operating revenue of the company in the 21st-23rd years will be RMB 7228 / 81.00/9088 million respectively, the net profit will be RMB 839 / 1013 / 1206 million respectively, and the EPS will be RMB 0.34/0.41/0.49 respectively, corresponding to the closing price PE on January 20, 2022, which will be 37.19/30.83/25.87 times respectively, maintaining the “increased holding” rating.

Risk factors: the demand for intelligent financial equipment and intelligent network construction is less than expected; The implementation of digital RMB application is less than expected; Technology R & D level is lower than expected; Overseas business is less than expected; Uncertainty risk of epidemic situation.

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