\u3000\u3000 Beijing Shengtong Printing Co.Ltd(002599) (002599)
Event: the company predicts that the net profit attributable to the parent company will be 60-90 million yuan in 2021. The company released the performance forecast for 2021. It is estimated that the net profit attributable to the parent company will be 60-90 million yuan in 2021, and the net profit after deducting non profits will be 58-88 million yuan, reversing the loss year-on-year.
The operation of science and technology education business has improved, but it is still affected by the local epidemic. In 2021, the company lost 40-50 million yuan in science and technology education service business. Compared with the subsidiary Lebo, Lebo lost 139 million yuan in 2020, and the operation of education business improved year-on-year in 2021. However, the company expanded the number of Direct stores from 2020 to 2021 (from 130 at the end of 2019 to 167 in 2021h1). Affected by the local epidemic in Zhengzhou, Xi’an, Nanjing, Beijing and other places in 2021, the store rent and teacher cost are relatively rigid, resulting in the impact on the profits of science and technology education. In addition, the company increased its investment in technology, teaching and research from 2020 to 2021, resulting in increased costs and affected the profitability of the business.
After the “double reduction”, demand transfer + policy support, children’s programming training is expected to be released in 2022. In terms of policy impact, after the implementation of the “double reduction” policy in July 2021, discipline education and training institutions q3-q4 focus on delivering courses, which affects the course scheduling and delivery rate of the company’s offline stores to a certain extent. However, with the termination of discipline training operation by many discipline institutions from 2022, the training demand is expected to transfer to non discipline training including children’s programming, and the relevant demand is expected to be concentrated and large-scale in 2022. In addition, the “double reduction” carries out capital supervision on the pre charging of training institutions, the speed of industry expansion is controlled, and training institutions with mature operation capacity and perfect channel construction are expected to benefit.
The printing and packaging business continued to grow and the operating efficiency continued to improve. The company made a profit of 110-130 million yuan from its comprehensive printing business in 2021. In terms of publishing and printing services, the company relies on the “Shengtong publishing service cloud platform” to continuously improve the degree of intelligence; In terms of packaging business, thanks to the release of the company’s production capacity and demand, the packaging business has achieved rapid growth.
Investment suggestion: the company has two main businesses: comprehensive publishing service and quality education and training service. As a leading enterprise in children’s programming in China, Lebo Lebo has a complete online + offline curriculum system for 3-18 years old to carry out the layout of the whole industry of programming education. Under the favorable quality education policy, the demand for children’s programming training is expected to increase in 2022, and Lebo Lebo is expected to fully enjoy the favorable policy. According to the company’s performance forecast, we adjusted the forecast of the company’s net profit attributable to the parent company in 2021 to 76 million yuan (the original 132 million yuan), and maintained the forecast of net profit attributable to the parent company from 2022 to 2023 of 217 / 260 million yuan, with a same increase of 185.5% / 20.1% in 2022 / 2023. The current price corresponds to 43 / 15 / 13 times of PE, maintaining the “buy” rating.
Risk tips: the risk of epidemic recurrence, stricter training and supervision policies, intensified market competition, franchisees’ risk control, and the profit in the process of business development does not meet expectations
