The global vehicle surveillance giant, covering the first time to give a "buy" rating, Rui Ming Technology is a global intelligent commercial vehicle surveillance giant. According to IHS's Global vehicle Video Surveillance Market report, the company ranked second with a global market share of about 10% in 2017. The company's global business layout, deep cultivation of public transport, rental, two passengers and one danger and other market segments, the core competence lies in the rapid response to the downstream fragmentation demand.
In the future, the company will focus on the blue sea market of trucks, which is expected to open up room for growth under the joint drive of domestic policies and overseas demand. We estimate that the return net profit of the company from 2021 to 2023 is 2.37,3.16 and 411 million yuan respectively, the corresponding EPS is 1.37,1.82,2.38 yuan respectively, and the corresponding share price PE is 32.9,24.7,18.9 times respectively. Cover for the first time, giving a "buy" rating.
The stock of commercial vehicles build a broad ceiling, the company's global layout differentiation operating vehicle monitoring products for commercial vehicle afterloading market, the company's global business layout, in the domestic and Latin America and other emerging markets through their own brand promotion, in Europe and the United States and other mature markets to cooperate with local brands in the way of ODM. According to the International Association of Automobile Manufacturers (OICA), the global number of commercial vehicles in 2015 is 335 million, and the average annual production from 2016 to 2020 is 23.66 million. Based on this, we estimate that the number of commercial vehicles will exceed 400 million in 2020, providing a broad ceiling for the vehicle monitoring market. On the basis of stock, the vehicles that need to be upgraded every year are in the class of 10 million. Based on the average product price of 2000 yuan, there is a market of 20 billion yuan for on-board monitoring every year.
In the future, we will focus on the layout of the truck market, policies and demand to open up the growth space at home and abroad. The core competence of the company lies in responding quickly to the fragmented demand downstream, continuously innovating around customer pain points, and successively opening up new markets such as school buses, dregs, sanitation cars, and so on. Trucks are the largest market in the field of commercial vehicles, the penetration rate is relatively low at present, and the company will focus on layout in the future. (1) on the domestic side, in November 2020, the Ministry of Communications issued the regulations of the people's Republic of China on Road Transport (draft for soliciting opinions on the revised draft), requiring vehicles carrying more than 1.2 tons to install on-board monitoring products. There are about 10 million commercial vehicles in line with the policy requirements, and we estimate that there will be a stock market of 20 billion. (2) overseas, the number of trucks in North America alone has reached 32.35 million, and the stock is much larger than that of the Chinese market. In view of the relatively mature fleet in the overseas market, the demand is expected to be more exuberant. In the future, driven by domestic policies and overseas demand, we will launch a vast blue ocean market for trucks and be optimistic about the future development of the company.
Risk tips: increased market competition; rising prices of upstream raw materials; truck market development is not as expected.
