Performance summary: in H1 in 2021, the company achieved operating income of 250 million yuan, an increase of 26.5% over the same period last year, and a net profit of 4138 trillion, an increase of 12.2% over the same period last year. Unfavorable factors such as the shortage of raw materials and the lower-than-expected shipments of downstream heavy trucks slightly affected the company's performance in the first half of the year, but with the strong installation policies such as "active safety business" launched one after another in various provinces, the company has won the bid in Guangdong, Henan and other provinces and cities. it is expected to start bulk supply in the second half of the year, and the medium-and long-term growth is still good.
The forerunner of the intelligent network of commercial vehicles, the customer resources are high-quality to build a moat. Since its establishment in 2009, the company has been deeply engaged in the field of intelligent network connection for commercial vehicles, successfully extending intelligent enhancement systems and other products from passenger cars to trucks, dregs, construction machinery vehicles and other models. The main customers include Suzhou Jinlong and the four enterprises of the top five vehicle factories in the heavy truck industry, and they are the first suppliers of Shaanxi Automobile and BAIC Foton. With the strength of high-quality products, the company's preloading business accounts for more than 85%, and continues to expand customer channel resources to Sany, Sinotruk, etc., laying a solid foundation for the company's business expansion.
The policy continues to be driven by landing, and the volume and price of smart terminals rise. In recent years, the new national standard, the new "Taoism" and the "sixth National Plan"
With the intensive introduction of policies such as automobile driving recorder, heavy diesel vehicle T-BOX, commercial vehicle active safety intelligent prevention and control equipment and other intelligent network connection terminals have made clear strong installation regulations and functional requirements, the front and rear loading incremental market has rapidly expanded, and the commercial vehicle intelligent network connection terminal has entered the golden period of rising volume and price.
The cornerstone of networked business is solid, and intelligent products make rapid breakthroughs. The company continues to expand its product line around the two major technology paths of network connection and intelligence, in which the network connection business is the foundation of the company, and the market share of intelligent enhancement system in the field of heavy trucks is more than 26%. It is expected to further expand the coverage area and customer base in the future and maintain steady growth. Intelligent business is the strategic focus of the company. With the rapid breakthrough in the release of demand for "active security" of downstream enterprises, ADAS has been fully bound with major customers after it was introduced into the preloading market in 2020. H1 has a year-on-year growth rate of more than 103% in 2021. It is expected to continue to expand product categories and customer resources in the future to achieve rapid volume expansion.
Profit forecast and investment advice. It is estimated that the compound growth rate of the company's return net profit from 2021 to 2023 will reach 38.5%. Based on the implementation of the new national standard, the sixth grade and other strong equipment policy requirements, the company, as the leader of the intelligent network of commercial vehicles, is expected to continue to expand its leading edge in the areas of heavy trucks and dregs, continue to expand its product line and business areas, and achieve rapid growth in performance, giving it 34 times PE in 2022, corresponding to the target price of 54.74 yuan, and maintaining "buy".
Rating.
Risk tips: policy promotion is not as strong as expected; raw material prices rise; business expansion is not as expected; industry competition intensifies, and so on.