Investment suggestion
We are optimistic that the company will focus on the main motor business and expand the new energy business, due to the increase in shipments of traditional motor parts:
The impact of the average growth rate of the fast-surpassing industry, the company's 1H21 performance exceeded expectations, upgraded to outperform the industry. The reasons are as follows:
Focus on the main motor industry, and the resource allocation is further optimized after the divestiture of the UAV service. In 2020, the company sold all the shares of its holding subsidiary, Tianyu Changying, and the company's drone business was completely divested. 1H21, the company's motor business recorded rapid growth, achieving operating income of 1.641 billion yuan, year-on-year + 39.56%; return to the mother net profit of 115 million yuan, + 22.65% year-on-year. We believe that the divestiture of the UAV business will help the company to further focus on the main motor business, and 1H21's performance verifies the company's competitiveness in the motor business, which is expected to further enhance the market competitiveness by virtue of specialized production capacity.
The traditional motor parts business builds a performance base, and new energy motors contribute new growth points.
In terms of sub-business sectors, the revenue of electric bicycle parts increased significantly. The 1H21 electric bicycle sector achieved 484 million yuan, an increase of 83.07% over the same period last year, while the auto parts / ice press plate reached 6.64 / 181 million yuan, an increase of 40.48% and 29.99% respectively over the same period last year. 1H21 domestic automobile and household refrigerator industry output increased by 26.4% and 18.8% respectively compared with the same period last year, and the company's revenue growth outperformed the industry. We believe that the company's three traditional motor parts business has a leading advantage in the subdivision of the track, and is expected to build a basic set of performance growth. With the gradual breakthrough of the new energy business, the industry leading edge is more solid.
Advanced manufacturing capacity expansion, new energy business, accelerate. As of 1H21, the company's self-built intelligent factory has entered the stage of completion and acceptance, and the capacity expansion is advancing steadily. In addition, the company speeds up the docking and verification of downstream customers, actively docking leading domestic electric vehicle enterprises and motor assembly suppliers, including NIO Inc., BYD, Schaeffler, Inbor and so on. The company locates the middle and high-end specialized motor parts manufacturing, and has the ability of R & D and production of precision stamping dies. We expect that the intelligent factory capacity will usher in a new round of capacity expansion after landing, and the company's new energy motor product supply is expected to accelerate.
Potential catalyst: the progress of customer certification of new energy motor is accelerated.
Profit forecast and valuation
The current share price corresponds to 20.5 Compact 17.2 times 2021 / 2022 Pdebase E. We upgraded our rating to outperform industry and raised our profit forecast for 2021 / 22 by 7.8% 14.5% to 3.47 / 412 million yuan. due to the company's refocus on the main motor business and the accelerated expansion of new energy business, we raised our target price by 57.7% to 20.5 yuan. corresponding to 23.8Univer 20.1 times 2021 / 2022 Pexue E, there is 16.5% upside compared with the current stock price.
Risk
The expansion of new energy business is not as expected.
