\u3000\u3000 Qi An Xin Technology Group Inc(688561) (688561)
Event: the company issued a performance forecast. It is expected to achieve a revenue of 5.670 billion yuan to 5.820 billion yuan in 2021, with a year-on-year increase of 36.26% to 39.86%, a net profit attributable to the parent company of – 600 million yuan to – 500 million yuan, a year-on-year loss increase of 49.54% to 79.44%, and a deduction of non net profit of – 830 million yuan to – 730 million yuan, with a year-on-year loss increase of 35.37% to 53.91%.
Revenue growth was in line with expectations. The company expects to achieve a revenue of 5.670 billion yuan to 5.820 billion yuan in 2021, with a year-on-year increase of 36.26% to 39.86%, in line with market expectations. Among them, Q4 is expected to achieve revenue of RMB 2.996-3.146 billion in a single quarter, with a year-on-year increase of about 30.77% – 37.32%. The continuous and rapid growth of operating revenue is mainly due to two reasons: (1) on the one hand, the competitiveness of the company’s core products has been greatly improved. Thanks to the company’s continuous promotion of R & D platform strategy, the standardization, modularization, modularization and performance of products have been comprehensively improved, and the market share and competitiveness of a variety of core products continue to lead the industry; (2) On the other hand, the company’s business growth benefited from the in-depth reform of the network security market, and the revenue of customers in key information infrastructure industries such as finance, operators, energy, power and medical treatment and government customers continued to grow rapidly.
The equity incentive fee affects the immediate profit. The company expects to realize a net profit attributable to the parent company of – 600 million yuan to – 500 million yuan, with a year-on-year loss increase of 49.54% to 79.44%, and a deduction of non net profit of – 830 million yuan to – 730 million yuan, with a year-on-year loss increase of 35.37% to 53.91%. In Q4, the net profit attributable to the parent company is expected to be 557-657 million yuan, a year-on-year decrease of 17.24% – 2.38%. The decrease in net profit attributable to the parent company was mainly due to the company’s launch of employee restricted stock incentive plan in 2020. During the reporting period, the company’s accrued share based payment expenses for employees increased by 256 million yuan compared with 2020, which had a certain impact on the net profit attributable to the owner of the parent company. Excluding the above effects, the net profit loss attributable to the owners of the parent company shows a narrowing trend compared with 2020.
The prosperity of the industry remains unchanged, and the company is expected to continue to benefit. In 2021, the data security law, the regulations on the security protection of key information infrastructure, the personal information protection law and other industrial legislation were successively issued, which opened a huge growth space for the network security market and had a far-reaching impact on the development of the network security industry. The regulatory environment pays more attention to the assessment of “practical” defense effect, driving the transformation of customer demand from “passive compliance” to “active legality”. The company’s products are more capable of practical, systematic and collaborative defense. Its technical competitiveness in the fields of data security and privacy protection, practical situational awareness, cloud security, terminal security, border security, security services and security operations will continue to lead the whole industry and will continue to benefit from the high outlook of the industry.
Investment suggestion: China is a leader in the field of network security, with continuous R & D and innovation. With a comprehensive product system and strong security service ability, the performance is expected to continue to maintain rapid growth. We estimate that the company’s operating revenue from 2021 to 2023 will be 5.763 billion yuan, 8.069 billion yuan and 11.135 billion yuan respectively, the net profit attributable to the parent company will be -531 million yuan, – 51 million yuan and 327 million yuan respectively, and the EPS will be -0.78, -0.07 and 0.48 yuan respectively, maintaining the “buy” rating.
Risk warning: policy promotion is not as expected; Increased competition led to lower than expected product sales.
