The individual champion of the isolation switch enters the GIS. At present, the company has formed an industrial pattern of power transmission and transformation equipment manufacturing, power design and engineering services. 2021H1, the company's transmission and transformation equipment manufacturing revenue of 640 million yuan, accounting for 91.27% of the total revenue, power design and engineering services, total contract revenue of 30 million yuan, accounting for 4.68% of the total revenue. We believe that according to the revenue estimate of the subsidiary, the income of 2021H1, disconnector, GIS and complete sets of appliances is 2.1,3.1 and 150 million yuan. 2021Q1-Q3, the company's parent net profit was 192 million yuan, an increase of 9.83% over the same period last year.
Equipment side: GIS+ disconnector two-wheel drive, breakthrough 550kVGIS products will provide new increments. 1) according to the Power Grid Development Plan of the 14th five-year Plan of the Southern Power Grid, the planned investment of the Southern Power Grid during the 14th five-year Plan period is about 670 billion yuan, an increase of 36% compared with the planned investment of the 13th five-year Plan. We expect that there will still be great development in the transmission and distribution side products during the 14th five-year Plan period. 2) according to Zhiyan, the market size of isolators will reach 2.621 billion yuan in 2021, and the number of isolators in 2020-2027 will be 5.4% CAGR. According to QYRESEARCH,2020, the global GIS switchgear market reached US $5028.3, and is expected to reach US $6457.8 in 2027, with CAGR of 3.6% (2021-2027).
China has about 40% of the market. 3) in 2021, the company's isolation switch grounding switch was recognized as the "national champion product" and has a good brand reputation in the switch field. 4) enter the GIS, the performance increases rapidly. The net profit of subsidiaries that mainly sell GIS in 2020 increased by 129% compared with the same period last year. 5) the company's 550kVGIS expects to complete the type test in 2022 and launch it in the second half of 2022, with a view to obtaining bulk orders in 2023 and higher voltage products or higher gross profit margin. 6) We estimate that the net profit contributed by the isolator from 2021 to 2023 will be 130 million, and the net profit contributed by GIS will be 0.7 billion yuan, respectively.
Sales channel: enter the south network, the distribution side channel sinks. 1) the national network has achieved excellent results in bidding. According to the data of Zhiyan Consulting, from September 2019 to August 2020, the company accounted for 19% of the national network's isolator switch tender (third). 2) enter the south net. The isolator has achieved excellent results in the bidding of the Southern Power Grid in 2021, and the combined appliances and complete sets of appliances have also passed the qualification examination of the Southern Power Grid, and it is expected to participate in the bidding in 2022 or be able to provide new increments. 3) the channel on the side of the distribution network sinks. With the promotion of "release, management and service" of the national network, the secondary and tertiary market has a huge space for development. the company has made an important breakthrough in the secondary and tertiary market in 2021, especially the outstanding performance of Hunan province, which is expected to continue to sink in the future.
EPC: reform the new energy EPC business model, lightweight and accelerate development. The main results are as follows: 1) in the past, most companies mainly sold their equity after independent development, which had the disadvantages of large investment and high cost of capital. 2) reshape the idea of development: lightweight development, seek joint development with central enterprises, and complement each other's advantages. 3) the company's own core competitiveness: design institute + rich experience. The company has one of the few private Class A qualified design institutes in China. Since 2015, a number of wind power, photovoltaic and other new energy projects have been completed. 4) We expect the net profit of the new energy EPC business to be 163,4406 and 88.11 million yuan from 2021 to 2023.
Profit forecast and investment rating. We estimate that the 21-23 year return net profit of the company will be RMB 262max, RMB 355max, respectively, and the corresponding EPS will be RMB 0.42, 0.57max, 0.87 respectively. With reference to comparable companies, we give 2022 older Gao Group a valuation range of 22-23 times PE, and the corresponding reasonable value range is 12.58-13.15 yuan. For the first time, it is given an investment rating of "better than the market".
Risk hint: the promotion of the EPC project is not as expected, the bidding of the southern power network and the sinking of the channel on the side of the distribution network are not as expected.