With the improvement of the prosperity of the LED industry, the production of the company's Changsha factory is progressing smoothly, and the newly signed order in 2021 has exceeded 10 billion yuan, close to the annual order target. 2021Q1-3 achieved a revenue of 5.834 billion yuan, an increase of 30.03% over the same period last year, with a significant increase in performance, and a net profit of 521 million yuan, an increase of 65.09% over the same period last year. With the Changsha plant put into production and gradually release capacity, the company is expected to further high growth.
Business conditions continue to optimize, on-hand orders remain abundant. The sales expense rate, management expense rate and financial expense rate of 2021Q1-3 were 9.23%, 5.55% and 1.49% respectively, which changed 0.34pct/-0.30pct/-0.55pct respectively compared with the same period last year. The company continued to increase R & D investment, with R & D expenditure of 243 million yuan in the first three quarters, an increase of 13.19% over the same period last year, helping the company to maintain a leading position in technology. As for orders, as of October 24, newly signed orders in 2021 increased by 42% over the same period last year and 14% over the same period in 2019. Among them, domestic smart display orders increased by 68% over the same period last year, international smart display orders increased by 42% over the same period last year, domestic channels took the lead in fulfilling the annual order target of 1.8 billion yuan, and NP orders increased by 84% over the same period last year.
Production side demand side two prosperous, long-term optimistic about the scale of volume. Affected by the epidemic, some of the equipment did not arrive at the plant as scheduled, and the Hunan plant that opened in July will be 2-3 months later than originally planned to reach production by the end of October. At present, the production capacity is increasing month by month, with a production capacity of about 3000KK in October and is expected to reach 5000KK by the end of this year. 6000KK is scheduled to reach its production target from January 2022. In terms of demand, the government's demand for big data display has increased significantly; the demand of commercial customers has also greatly increased, benefiting from the scale of the cost side, small spacing products have reached the level of better performance-to-price ratio, and the application is not just a simple display. but in advertising, 3D screen, shooting screen and so on have dabbled in, the expansion of the application also makes the demand of commercial customers continue to grow.
The commercialization of Micro LED is smooth, and breakthroughs have been made in R & D achievements. Micro LED overseas market has begun to start, and orders are growing rapidly, with a confirmed operating income of more than 200 million yuan in the reporting period. On the progress of research and development, the COG project jointly developed with TCL Huaxing Optoelectronics has been tested, and a small batch of product samples will be completed in the near future; the Liad custom ASIC chip has been taped out, and the sample has entered the testing link, and small batch trial production is expected to be carried out in the fourth quarter of 2021. With the continuous maturity of Micro technology, the market space is expected to further open, and the company's profitability will continue to improve.
[investment advice]
As the leader of global LED display, the company has ranked first in the global market share of LED display for five consecutive years. At present, the company is full of orders on hand, and outdoor LED shows that products are in short supply. When the company releases the production capacity of the new Changsha plant at the beginning of 2022, the operating efficiency is expected to reach a new height. Therefore, we maintain our judgment on the performance of the company. The operating income of 2021 and 2022 in 2023 is 85.80, 108.59 and 13.440 billion respectively, and the net profit of homing is 7.82, 11.18, 1.503 million, respectively, and EPS is 0.31, 0.44 and 0.59, respectively, and the corresponding PE is 30-21-16 times, respectively, and is given an "overweight" rating.
[risk Tip]
The progress of technological breakthrough is not as expected.
Downstream business display demand is lower than expected
Exchange rate fluctuation risk.