\u3000\u3000 Meig Smart Technology Co.Ltd(002881) (002881)
Announcement summary: the company released the performance forecast for 2021. It is expected to realize the net profit attributable to the parent company of 110 million yuan to 125 million yuan in 2021, with a year-on-year increase of 300.87% – 355.54%, deducting the net profit not attributable to the parent company of 72 million yuan to 87 million yuan, with a year-on-year increase of 343.42% – 435.80%.
The annual performance increased sharply, and the profitability of Q4 rebounded month on month in a single quarter. The company expects that the operating revenue in 2021 will be RMB 1.950-2.050 billion, with a year-on-year increase of 73.95% – 82.87%. The company maintains a high growth trend throughout the year, and the performance is in line with expectations. Q4 expected revenue of 629 million yuan to 729 million yuan in a single quarter, with a year-on-year increase of 45.72% – 68.88%. The net profit attributable to the parent company is expected to be 30.49 million yuan to 45.49 million yuan, with a median of 38 million yuan, with a significant year-on-year increase of 151.24% and a month-on-month increase of 18.81%. The profitability of the company continues to improve. The company’s performance growth is mainly driven by the significant increase in the shipment of 4G / 5G wireless communication modules and solutions. According to the counter point data, in the global module shipment in 2021q3, the company’s market share rose to 5.4%, with a month on month increase of 0.1%, ranking fifth. The market recognition of the company’s wireless communication module + Solutions business model continues to improve, with global operators, brand customers The scale of high-quality customer groups represented by listed companies continues to expand, and 5g modules of operators have won the bid for many times. The company is deeply engaged in the customized development of 4G / 5G intelligent modules. It has in-depth cooperation with Huawei and Qualcomm to continuously improve its R & D strength and expand the scale of R & D team. It is estimated that the R & D cost will be about 170 million yuan in 2021, with a year-on-year increase of 20.53%. At present, the product layout is perfect, covering three product types: intelligent Android module, M2M data transmission module and FWA terminal, forming a complete product series, For core 5g application scenarios such as new retail, intelligent payment and intelligent Internet connected vehicles. It is expected that the company’s performance will continue to grow with the high prosperity of the industry and the large volume of products.
The Internet of things module is booming, and the application in the field of intelligent network connected vehicles is accelerated. As the core component of IOT terminal, communication module has entered the business cycle with the innovation of intelligent terminal and large-scale volume. From the perspective of product structure, 4G products are the mainstream of the market, and 5g modules have ushered in large-scale commercial applications. According to counter point data, the shipment of global cellular IOT modules increased by 70% year-on-year in the third quarter of 2021, and the revenue exceeded US $1.5 billion, mainly benefiting from Nb IOT and 4gcat 1. The module has increased significantly, and the shipment volume of 5g module has increased by 700% year-on-year. It is expected that with the introduction of 5g module by various manufacturers, the price of 5g module has decreased and the demand has maintained a high growth rate. As a key link connecting the perception layer and network layer of the Internet of vehicles, the on-board wireless communication module will fully benefit from the trend of vehicle intelligence and networking. According to the data of the State Administration of market supervision, the penetration rate of new vehicles equipped with intelligent networking function in the world will be about 45% in 2020 and is expected to increase to 60% in 2025. The penetration rate of intelligent networking vehicles in China will be about 15% in 2020 and more than 75% in 2025. Under the trend of software defined automobile, with the advantages of cellular communication connection, customized Android operating system and computing power, intelligent module can enable terminal equipment to have task processing ability and computing ability while accessing the network, realize intelligent networking, meet the needs of software and hardware iteration in the life cycle of intelligent network connected vehicle, and is expected to further expand its application in the automobile industry, Improve its penetration in the module industry.
FWA terminal + on-board module are used in large quantities to broaden the application scenarios of the products. With the gradual improvement of 5g networks at home and abroad and the promotion of operators, FWA terminals will usher in rapid development. According to the prediction of the Internet of things industry alliance, in 2025, the global 5gcpe shipment will reach 120 million units, with a market scale of 60 billion yuan, and the Chinese 5gcpe shipment will reach 80 million units, with a market scale of 27 billion yuan. The company seized the market opportunity and formed a rich FWA product series by taking advantage of the technology and product development experience accumulated in many years of cooperation with Huawei. FWA’s main markets are concentrated overseas. The company has directly supplied large quantities to a number of overseas operators, including continuous delivery in North America and Japan. The European sales and technical support team landed in early 2021. Projects and orders have been imported, and is actively participating in the bidding of relevant projects of major operators. In terms of vehicle modules, the company’s customers cover vehicle manufacturers, Tier1 manufacturers, afterloading customers, etc. standard data transmission modules have been widely used in traditional vehicle product fields such as Tbox, and intelligent module products have been widely used in auxiliary driving fields such as intelligent cockpit and ADAS / DMS. 5g intelligent module products have been mass produced and shipped to China’s leading new energy vehicle enterprises and applied to intelligent cockpit system. With the continuous penetration of Android operating system into the vehicle field and the continuous development of the trend of one core multi screen and multi-channel camera access in the intelligent cabin, it is expected that the company’s intelligent module products will usher in a broad market space. During the reporting period, the company made breakthroughs in the field of smart grid, and the layout of cloud computing, laptop, HD video and other fields continued to deepen, which is expected to provide new performance growth points in the future.
Investment suggestion: Meig Smart Technology Co.Ltd(002881) is a rapidly rising leader in intelligent modules of the Internet of things, forming a complete product series of intelligent modules. The products of digital transmission modules are expanding continuously, which has certain differentiation advantages. We believe that intelligent modules have large application space in the future, and we are optimistic about the business layout of the company in the field of intelligent network connected vehicles and FWA. We expect the net profit of the company from 2021 to 2023 to be 121 million / 202 million / 311 million respectively, and EPS to be 0.65 yuan / 1.09 yuan / 1.69 yuan respectively, maintaining the “buy” rating.
Risk warning: industry competition intensifies the risk; The development of Internet of things is less than expected risk; Upstream chip shortage risk; The public data used in the research report may have the risk of information lag or untimely update.
