Main points of investment:
Semi-annual report. The company's 21H1 realized income, net profit attributable to parent shareholders and net profit attributable to non-parent shareholders were 1.743 billion yuan, 112 million yuan and 91 million yuan respectively, representing year-on-year changes of 32.38%,-12.94% and-22.55%, respectively. Among them, the realized income of 21Q2 Company, the net profit of shareholders vested in the parent company and the net profit of shareholders vested in the parent company after deduction were 1.034 billion yuan, 72 million yuan and 64 million yuan respectively, up 25.89%,-28.18% and-33.42% respectively over the same period last year.
From the perspective of sub-channel, the retail channel of 21H1 company is growing rapidly, and exports are a drag on the overall income growth. The company's 21H1 domestic sales increased by 41.09% over the same period last year, of which retail channel sales reached 901 million yuan, an increase of 51.14% over the same period last year, and engineering channel sales reached 421 million yuan, an increase of 23.52% over the same period last year. The company's foreign sales 21H1 was 406 million yuan, an increase of 10.55% over the same period last year.
Gross profit margin fell. The company's 21Q2 gross profit margin and net profit margin were 28.60% and 7.75% respectively, down 6.05% and 4.83% respectively from the same period last year. The decline in gross profit margin is partly due to the social security relief enjoyed in the same period last year, while the increase in channel investment leads to an increase in the company's sales expenses and an increase in exchange losses leads to an increase in the company's financial expenses.
Net cash flow from operating activities decreased. The net cash flow generated by 21H1's operating activities was-137 million yuan, a decrease of 143.54% compared with 20H1's 314 million yuan. From the income-to-cash ratio data, the company's 21H1 income-to-cash ratio is 0.97, which is lower than the 1.02 level of 20H1, and the net-to-cash ratio is-1.12, which is also lower than the 2.41 level of 20H1. The decline in 21H1 operating net cash flow is mainly due to a large increase in other receivables, from 11 million yuan at the end of 20 to 165 million yuan in 21 years, which is mainly due to the increase in margin paid.
B and C make joint efforts, and it is expected that the business will continue to improve. In the first half of 21 years, the company's retail channel "Huida" brand opened 112 new stores and upgraded 108stores in the blank market. As of June 30, 21, the company "Huida" brand has a total of 2323 stores, including 1900 bathroom brand stores and 423 ceramic tile stores. In terms of engineering channels, the company has reached a cooperative relationship with Country Garden Holdings, Sunac China, Poly Real Estate, Jindi Group, Cambridge Real Estate, first Real Estate, Wanda Real Estate and other well-known real estate enterprises. We believe that the B-end and C-side of the company continue to develop, and the business situation is expected to continue to improve in the future.
Profitability and valuation. We estimate that the EPS of the company from 2021 to 2023 is 0.88,1.07,1.24 yuan per share respectively, which is comparable to the median forecast PE of listed companies in 2021. We give the company 16-17 times forecast PE in 2021, corresponding to the reasonable value range of 14.08-14.96 yuan per share in 2021, which is "better than the big market".
Rating.
Risk tips. The acceptance of domestic brands by engineering customers is lower than the expected risk.