\u3000\u3000 Longshine Technology Group Co.Ltd(300682) (300682)
Event overview
On January 20, 2022, the company disclosed the performance forecast of 2021. In 2021, the revenue increased by more than 35% year-on-year, and the net profit attributable to the parent company was + 15.97% – 24.45% year-on-year, about 820-880 million yuan; The net profit attributable to the parent company after deducting non profits is about 700-760 million yuan.
Analysis and judgment:
In 2021, the revenue is much higher than expected, and the demand for energy business is high
1. The revenue exceeded expectations and the downstream was booming. According to the company’s forecast, the company’s revenue in 2021 increased by more than 35% year-on-year, exceeding expectations; The net profit attributable to the parent company in 2021 is about RMB 820-880 million, which is basically in line with the expectation. Taking the revenue growth of 35% and the expected average value of net profit attributable to the parent company, the company’s revenue in 2021 is 4.57 billion yuan, realizing a net profit attributable to the parent company of 850 million yuan, and the company’s revenue in the fourth quarter is 2.39 billion yuan, a year-on-year increase of + 22.4%; The net profit attributable to the parent company was 670 million yuan, a year-on-year increase of + 17%.
2. The decrease of net interest rate may be due to the increase of investment in new and old businesses. The net profit margin of the company in 2021 is lower than the net profit margin of 21.1% in 2020. We believe that this may be due to the increase of investment in sales and R & D expenses: 1) the company will vigorously develop new businesses such as charging pile platform in 2021, which needs some promotion investment to expand the market; 2) The downstream of the company is booming and the demand for R & D is strong. According to the company’s announcement, more than 500 R & D personnel will be added in 2021 (4234 at the end of 2020, an increase of 12%). The investment in R & D has a direct effect on business expansion and can enhance the core hard strength of the company. We believe that working first and then reaping is the only way in the business expansion period. The company’s investment in the overall business will gradually release the growth dividend in the next few years.
3. In addition, the contribution of non recurring profit and loss to net profit of the company in 2021 is expected to be about 110 million yuan, mainly due to government subsidy income, about 120 million yuan in the same period of last year. The company’s equity incentive fee was about 130 million yuan, up from about 90 million yuan in the same period last year.
The revenue of 2B energy digital business grew by more than 40%, and the power reform stimulated the company to grow more than expected
1. The revenue of Langxin’s traditional 2B business increased year-on-year, or was stimulated by the iteration of the power sales platform. According to the company’s announcement, the company’s 2B energy digital service business will enter a period of major development opportunities in 2021. It is expected that the revenue of energy digital service business will increase by about 40% year-on-year, which is higher than expected. We believe that the Longxin power sales platform business may contribute to the main growth of 2B business. The Power Grid plans to replace the power marketing system during the 14th Five Year Plan period, and the business increment provided by the system replacement within five years can be expected.
2. The emerging business forms of electric power are diverse, and the profit model is upgraded. At present, Lanxin has built products / solutions such as energy consumption management and charging station SaaS software. Emerging businesses can realize the transformation of profit mode from project system to pumping system, and the profitability is further optimized. We believe that the company can further expand its business depth and develop new business formats such as power big data and energy consumption management based on its ability in provincial network marketing platforms.
The charging capacity is nearly 560 million kwh, which is higher than expected. The power wholesale business has been developed, and the capacity boundary has been widened!
1. The trading volume of the platform increased rapidly, and the charging volume was nearly 560 million kwh, exceeding the expectation. According to the company’s announcement, by the end of 2021, the new power path aggregate charging platform has been connected to more than 400 charging pile operators, and has been connected to the platforms of head operators such as national household appliance network, China Southern Power Grid, special call, star charging and cloud express charging. The number of operating charging piles exceeds 300000, the number of new energy charging motor vehicles exceeds 2.1 million, and the aggregate charging capacity in 2021 is nearly 560 million kwh, It is nearly 8 times of the charging capacity in 2020, which is much higher than expected.
2. Develop power wholesale sales based on aggregation charging business, and further broaden the leading capacity boundary in the field of power sales! According to the company’s announcement, in 2021, the revenue of aggregate charging business achieved rapid growth, and the revenue model was also expanded from service fee sharing to power wholesale sales and other fields. Different from the previous market expectations, Langxin charging platform business breaks the shackles of profit imagination of aggregation platform and broadens its capacity to the energy end: we believe that its power wholesale business not only confirms the company’s high strength in the field of energy and power sales, but also a strong signal that it will continue to broaden its business boundary.
Investment advice
Longshine Technology Group Co.Ltd(300682) has benefited greatly from the charging aggregation platform and power grid informatization. Based on the company’s performance forecast and the company’s business expansion period or increased investment, we raised the forecast of the company’s revenue of 4.34/5.51/6.97 billion yuan in 21-23 to 4.59/58.3/7.39 billion yuan, adjusted the forecast of earnings per share (EPS) of 0.84/1.08/1.37 yuan in 21-23 to 0.81/1.11/1.39 yuan, corresponding to the closing price of 36.47 yuan / share on January 20, 2022, and PE was 45 / 33 / 26 times respectively, Maintain the company’s “buy” rating.
Risk tips
1) the risk that revenue depends on the power industry; 2) The implementation of new energy policy subsidies is less than the expected risk; 3) New energy power generation technology reform process is less than expected risk; 4) Information construction is less than expected risk; 5) Macroeconomic downside risks.
