Incidents:
The company released its 2021 semi-annual performance report. Operating revenue for the period was 332 million yuan, an increase of 47.74% over the previous year, and the net profit of the mother was 21 million yuan, an increase of 17.22% over the previous year, after deducting non-net profit of 21 million yuan, an increase of 30.04% over the previous year.
Key points of investment:
Revenue has increased steadily, and the high growth of the nuclear industry has continued to materialize. As the company's intelligent equipment business for the nuclear industry entered a centralized construction period, products were delivered in batches, and overall revenue grew steadily. Q2 single-quarter revenue increased 71.56% year-on-year, a significant increase of 60.47pct from Q1; net profit growth was negative, reaching 40.27%. The core industry and special environment intelligent equipment system business achieved revenue of 163 million yuan during the reporting period, an increase of 103.40% over the previous year, with a gross profit margin of 19.76%; the intelligent test simulation system and microsystem and control component business achieved revenue of 100 million yuan, an increase of 11.99% over the previous year, with a gross profit margin of 30.22%; and the railway vehicle operation safety inspection and maintenance system business achieved revenue of 69 million yuan, an increase of 24.94% over the previous year, with a gross profit margin of 19.51%. The three accounted for 49.05%, 30.12%, and 20.83% of operating income, respectively, and the share of nuclear industry business increased dramatically. Affected by changes in product structure, the company's comprehensive gross margin declined by 4.21pct to 22.86%.
Downstream demand is strong, and raw materials and products have increased dramatically. In the first half of the year, the company received 525 million yuan in cash for the sale of goods and the provision of labor services, an increase of 29.62% over the same period last year; cash for purchasing goods and receiving labor payments was 540 million, a sharp increase of 150.93%; year-end contract debt reached 475 million, an increase of 44.65% from the beginning of the period, or confirming strong downstream demand and improving prosperity.
Meanwhile, the company's end-of-period inventory increased 29.9% from the beginning of the period to 992 million. Among them, raw materials were 39 million, a sharp increase of 106.80%; there were 709 million products, an increase of 43.67%, which may indicate that the company is actively preparing and preparing materials, and the scale of production continues to expand.
Backed by the Fifth Aerospace Academy, it is expected to benefit from the rapid development of the aerospace and nuclear industry. The company is an industrial development platform, institutional mechanism innovation platform, and asset securitization platform for the Fifth Aerospace Academy in the field of intelligent equipment. Major asset restructuring was completed in 2019, and Xuanyu Space and Xuanyu Intelligence merged to expand the scope of business to the aerospace and nuclear industries. The company is an important supporting unit in the aerospace field. It is in a leading position in some spacecraft aerospace chips and microsystem components and ground-based supporting test simulation equipment. At the same time, the company's intelligent equipment business in the nuclear industry is developing rapidly, stabilizing the market share of core products. We believe that during the “14th Five-Year Plan” period, the company will continue to benefit from the rapid development of the aerospace and nuclear industry.
Profit forecasting and investment ratings: First coverage, giving buy ratings. The net profit attributable to the company in 2021-2023 is estimated to be 187 million yuan, 228 million yuan and 286 million yuan respectively. The corresponding EPS is 0.26 yuan, 0.32 yuan and 0.40 yuan respectively. Corresponding to the current stock price PE is 42 times, 34 times and 27 times, respectively. It is covered for the first time and given a purchase rating.
Risk warning: 1) space launch falls short of expectations; 2) demand for robots in the nuclear industry falls short of expectations; 3) risk of profits falling short of expectations; 4) systemic risk.